“Although the pound is gaining strength, Central / West End of London commercial property investments still currently look cheap to foreign investors, hence significant recent deals such as the reported sale of Land Securities Park House development to a Qatari-backed investor for circa £250m.
“Because the property REITs are currently rebuilding their balance sheets and the banks are generally not lending on development, selling existing “oven ready” supply is one of the only ways commercial developers can raise capital, and whilst there is a significant amount of foreign money in the market to purchase, it makes sense to sell.
“Foreign investors want to buy tangible assets, and commercial property in London is deemed a safe bet, particularly as there are few places in the world with long leases with upward only reviews every five years; another attraction.”
Simon concludes: “We anticipate a continued strong market in the West End, particularly now the emergency Budget has been announced and there is more clarity on the detail of the Governments’ plans.”
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