Around £34 bn (€43 bn) of equity across the entire risk spectrum is targeting Central London at the moment, according to James Hammond, director of Capital Markets Central London at CBRE.
Around £34 bn (€43 bn) of equity across the entire risk spectrum is targeting Central London at the moment, according to James Hammond, director of Capital Markets Central London at CBRE.
‘We have never seen the depth and diversity of equity that we are seeing today. There is just not enough product for everyone,’ Hammond said, speaking at a conference during the EXPO REAL trade fair in Munich. ‘London is always the first stop for overseas investors. We have seen this trend again and again, it is due to the liquidity and accessibility of the market,’ he added.
Since the start of 2013 to the end of June 2014, Europe attracted €249 bn of overseas investment into the real estate sector, with London in particular representing by far the top investment destination, being the lucky recipient of 36% of that capital, research from CBRE shows. Despite the record level of demand, Hammond is reluctant to call the top of the market. ‘There are still good rental growth prospects in London. Businesses are growing faster, I don’t see any chance of capital diminishing in the near term,’ he noted.
To the contrary, he expects further yield compression in Central London in the coming months. ‘From a yield perspective, we are certainly not yet at the levels seen in 2006 and in 2007.’
