Overseas Commercial Property Investors taking Advantage of Brexit

Posted on 3 May, 2016 by Chris Grigorovsky

With the pending EU referendum causing concern in the London commercial property market, private investors from the Middle East and elsewhere have found an ideal opportunity to buy landmark buildings.

London

One firm for example, 3 Associates, is a UK family office that in the coming months is looking to deploy £500m, which combines its own capital with overseas partners, into London real estate.

Ahead of the vote on June 23, the firm is aiming to buy further central London assets after acquiring 1 Pall Mall East for £85m last month with investment vehicle of Saudi Bin Mahfouz family.

This spending intrigue is due to falling investment, where capital into central London office buildings fell by more than half in Q1 2016, which subsequently led to an overall drop in UK commercial property investment.

Richard Divall, the head of cross-border capital markets at Colliers, said 3 Associates aren’t the only ones seeking investments, adding “Anyone who requires a rigorous board approval process is struggling before the referendum, but family office capital and other entrepreneurial capital is viewing this an opportune time.”

Hong Kong billionaire Joseph Lau’s property investment company purchased an office in Mayfair in March and is seeking further London assets.

Jesdev Saggar, 3 Associates’ managing director, said: “There are a lot more opportunities being presented to us. Some large funds are rebalancing in case the vote goes the other way and that means we can look at assets we would never typically have access to.”

However, he remains confident in London investment, concluding: “There will be a hiccup if Brexit does happen but I don’t think we’re going to fall into some kind of vortex of economic decline.”




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