International Private Capital Survey 2013/2014
Qualitative and financial drivers for London based investments
Where investment is planned in London over the coming year, investors generally
have existing assets in the city, according to our survey results. Investors note
the potential capital value growth offered by the city but equally are looking for
attractive yields. This perhaps explains why, despite a continued preference for
residential assets, HNWI investors are looking increasingly at the commercial sector.
Our experience suggests that such investors are showing greater comfort with
commercial investments outside the traditional prime city core, which offer a higher
yield. Certainly the improved economic and business environment has assisted
this more flexible strategy. We have also found an increased investment interest in
student and affordable housing which again present the opportunity for a higher
yield when compared to prime residential, although Shariah compliance is still likely
to be a prerequisite for many investors from the Middle East.
CURRENT FACTORS INFLUENCING HNWI INVESTMENT IN LONDON
6.3%
Lifestyle offered/second home
16.7% 27.1% Children’s education
Business growth
Purely investment/expansion of portfolio
25.0% 25.0%
Security
*weighted average, based on top three factors, per office Source: Cluttons, VPC Asia Pacific
CURRENT DRIVERS INFLUENCING HNWI INVESTMENT IN LONDON
4.3%
4.3% Perceived safe haven
26.1% Capital value growth
21.7% Yield
Exchange rate
Connectivity & infrastructure
21.7% 21.7%
Financial market performance
*weighted average, based on top three drivers, per office Source: Cluttons, VPC Asia Pacific
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