Middle Eastern investors are set to spend €5bn in the UK and the Eurozone in 2017 as US investors take a back seat in the region, according to Fidelity International’s latest European Investment Pulse analysis.
Although traditionally favouring London, investors from the Middle East are expected to shift their investment towards core Eurozone – including Germany, France and the Netherlands – and regional UK assets as a way of diversifying their portfolios.
Canadian investors are also likely to increase their presence in the region on the relative strength of the Canadian dollar. European acquisitions totalled €3.4bn in 2016 – the highest since Fidelity started collecting deal-by-deal records in 2007 – and the report predicted a further €3-5bn of acquisitions per year, focused on Germany and the UK.
Iryna Pylypchuk, senior European real estate analyst at Fidelity International, said: “The Eurozone’s ability to cope with the political uncertainty has been impressive, and with a further economic upturn in evidence in the latter quarter of 2016, another year of strong performance looks likely. The abundance of capital remains the key challenge for European real estate.
“The recent strengthening of interest from Canadian investors is one example of a new source of capital emerging to complement Middle Eastern and Asian investors who will continue to target Europe’s most liquid markets as the US capital retreats.”
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