UkPubsLondon.com

Boost for London real estate

Posted on October 10th, 2009 in Uklondonpubs Londonpubs

Financial district in London: The gloom of recent months has passed Enlarge image the financial district in London: The gloom of recent months has passed REUTERS

The City of London bankers, the sunny fall weather to enjoy with a beer at the pub, the tables of sidewalk cafes for lunch are fully staffed. In the financial district, the depressed mood of recent months has passed. And the real estate market, there are signs of hope.

“Crisis? What crisis? “Joked Ralph Peter Dorff, Director of Real Estate Fund Management at the Hamburg Hansainvest if it is addressed to the London market. For while the situation in the public consciousness is still bad, professional investors have long been active again on the Thames.

Thus Hansainvest bought, a subsidiary of the insurer Signal Iduna, already in the midst of the crisis in March 2008 for the equivalent of 200 million euro is a Norman Foster-office building in London, and later objects in Manchester and Leicester. “At that time nearly all German investment companies have sold more, but we in Britain have a counter-cyclical strategy deliberately driven,” stated Peter Dorff early start. While he admits a few months later, it would probably have been even slightly more favorable: “But the important thing is the rise in yields to be there.”
Prices in London fell by around 40 percent

For two reasons for making London the eyes of foreign buyers especially interesting again: Since the crash of the overheated real estate market with the start of the financial crisis in the summer of 2007, prices fell by around 40 percent, so that many objects now have an extremely favorable. At the same time the pound against the euro has lost about 30 percent of its value. It returns to lure an attractive acquisition, which is the ratio of the achieved net cold rent paid for the purchase price. Since the crisis began, rents slumped to its lowest level for 20 years, the vacancy rate climbed from the third quarter of 2007 to June 2009 from 4.9 to 12.4 percent.

Nevertheless, experts believe in a turnaround. They are concerned with the prices in the City of London and Canary Wharf office in the Docklands is no further sharp decline. “When you a timeframe of ten years at today’s initial ten percent rate of return be possible,” said Tony McGough, an analyst at real estate agents and consultants DTZ in London.