Foreign capital was behind 75% of the office investments in London so far this year, according to preliminary research by Jones Lang LaSalle. Asia accounted for 27% of the foreign acquisitions.
Foreign capital was behind 75% of the office investments in London so far this year, according to preliminary research by Jones Lang LaSalle. Asia accounted for 27% of the foreign acquisitions.
The property adviser recorded £6 bn (EUR 7.4 bn) of investment in the sector this year, up 8% on the same period last year.
JLL said a further £10 bn is currently targeting the market, which could potentially drive up investment volumes to £12 bn by year-end, up 11% on 2011. However, it noted that the lack of supply in the West End is curtailing the number of transactions.
Damian Corbett, head of London Capital Markets at Jones Lang LaSalle, said: 'Strong competition for core assets is keeping pricing buoyant and demand continues to grow for good quality, well-let assets as well as short income asset management opportunities.'
‘The City market is currently experiencing a yield divergence between prime and secondary stock, with a flight to quality putting further pressure on yields. However, the discount on secondary product is widening as the contagion of the eurozone banking and currency crisis has caused investors to inject more risk into their pricing.'
