Investment volumes in London fell 19% to £13.1bn in 2016 despite a strong rebound in the fourth quarter, according to CBRE’s latest Property Perspective report.
The capital saw £4.1bn in investment in the fourth quarter, with the number of deals rising to 66 from 42 in Q3. Of those 66 deals, 11 were bigger than £100m.
However, total volumes fell following a slump in investment in the aftermath of the EU referendum in June, which made Q3 the weakest quarter since 2011.
According to the report, overseas investors made a strong return to the capital at the end of the year.
Three-quarters of Q4 volumes were completed by overseas buyers, who also accounted for 93% of volumes in the 11 biggest deals.
That return meant overseas investors were responsible for 70% of total volumes in 2016, the biggest proportion since 2013.
Asian buyers were the most active, making up 25% of total volumes.
Chris Brett, head of international capital markets at CBRE, said: “Previous market uncertainty following the referendum result showed clear signs of having subsided in Q4 2016 and overseas buyers returned to London with force.
“Not only did the number of transactions increase but the number of sizeable transactions was also much higher, highlighting investors’ confidence in London and its status as a global safe haven.”
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