Member Article

Its fair to say 2008 was an extremely challenging year for UK property.  Anything between 25-50% has been wiped off values from their peak in mid 2007.  However, 2009 may offer investment opportunities for overseas investors and the following information may be of interest to your clients:-

Fundamentals

The UK remains a fundamentally safe place to invest:-
 

• Social stability and benign political landscape  
• Finite land supply with constraints on planning and development
• Growing population

Market

Arguably positive buying conditions have now returned to the market:-

• Reduction of interest rates/LIBOR  
  
• Strong currency play for overseas investors given Sterling's falls against the Euro and the Dollar


• A number of competitors absent from the market e.g. debt funded investors and institutional funds with ongoing redemption issues 
  
• Major players engaging in market activity in late 2008/early 2009:-




• London and Stamford purchase of 1 Fleet Place, London for £74m
  
• Pramerica acquisition of 11 Pilgrim Street, London for £52m
  
• CBRE Investors acquisition of Meadowbank Retail Park, Edinburgh for £37.5m
  
• General acknowledgement by most of the major players that 2009 will present opportunities (see commentary from the likes of Legal & General, Prupim, British Land, Schroders and Grosvenor – Property Week 9 Jan 2009).

Hopefully this note provides a useful overview of where the UK property market stands and the opportunities 2009 may hold for UK property investment.