UK real estate chief executives are more worried about geopolitical uncertainty than are their global peers.
The finding is contained in the global edition of the PwC/ULI Emerging Trends in Real Estate report, which will be published at MIPIM next week.
Speaking at today’s Scottish Property Federation conference, PwC’s Gareth Lewis said the report would highlight increased caution among real estate investors, largely driven by macro-economic factors.
Some 80% of UK chief executives are concerned about geopolitical uncertainty, 63% are cautious about the eurozone debt crisis, and 82% are worried about over-regulation. In all three cases, the level of concern among UK chief executives was higher than among investors in other geographies.
Lewis said these factors would affect investment decisions around the world: “You can’t ignore the data and the anecdotes that show international capital flows are going to be much more tempered.”
Lewis said the latest edition of the report would highlight a more competitive environment for global capital, which in the short term could favour the US.
Changes to US rules that allow sovereign wealth funds to hold more US real estate without punitive tax charges – the FIRPTA rules – could increase allocations to real estate on the other side of the Atlantic, he said.
Solvency 11 and the inclusion of REITs in the S&P 500 could also see more capital flow west from Europe.
To send feedback, e-mail damian.wild@estatesgazette.com or tweet @DamianWild or @estatesgazette
