Gulf money looks past West End for £200m South East splash
By Joanna Bourke – Estates Gazette | News | 18-01-2014
Middle Eastern appetite for prime central London property is spreading to the South East as investors chase higher yields.
Gulf investors that have focused on the West End in recent years are broadening their strategies to include the South East, according to Collier International.
Middle Eastern investors completed eight deals in the South East in 2013 totalling £137m, nearly double the £67m invested in 2012. The agent forecasts it will rise to more than £200m in 2014.
JR Capital, which acts for Middle Eastern private families and institutions said for the first time it had increasing demand from its clients to look at purchases outside of prime central London, in areas including the Thames Valley.
The company said it invested in excess of £100m in the past 18 months, £15m of which was outside central London. With a forecast of £100m planned expenditure this year, JR Capital expects at least £30m will be outside of central London, with a focus on the South East.
Advised by GVA, it has just bought a 22,000 data centre in Park Royal, let to telecoms company EE, for £4.4m – a 6% yield, from a private UK family represented by Buchanan Bond.
John Collier-Wright, founder and managing director of JR Capital, said “The investment market outside of central London will continue to strengthen in the coming 24 months for good quality assets, as confidence grows and more overseas investors are prepared to look for better value”
He added that his Middle Eastern clients were looking for higher-yielding income of 6% plus, which he said was difficult to come by in central London.
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