Institutional investors remain confident about investing in real estate despite the pandemic and consider properties in London to be the most attractive, a German developer has found.
The research, which was commissioned by Wiener Komfortwohnungen and carried out by German opinion research institute Kantar, surveyed 400 institutional investors in Great Britain, Germany, Austria and Switzerland.
It found 39 per cent of investors consider London to be the most attractive location in Europe, followed by Berlin (35 per cent) and Vienna (23 per cent).
For British professional investors, London was ranked as the top city to invest in with 67 per cent, followed by Berlin with 29 per cent and Amsterdam (22 per cent).
Despite the pandemic, almost two thirds of investors (63 per cent) said they had no plans to change their investment behaviour in real estate or to reallocate within the portfolio.
In particular, German (72 per cent) and British (63 per cent) investors tend to stick with their previous strategy.
Around a quarter (25 per cent) want to increase the proportion of residential properties in their portfolio, while only eight per cent are considering reallocating in favour of commercial real estate.
“The enormous demand for housing and construction in major European cities is met investor-side by the need to invest financial resources safely and profitably, especially in turbulent times,” said Alexander Finster, managing director of Wiener Komfortwohnungen.
“Bringing these interests together is the key to the urgently needed societal response to the mega-trend of urbanisation.”
For the majority of investors (88 per cent) the location of a property remains the decisive selection criterion.
Finster said that the areas surrounding major cities will attract even more attention from investors and the construction industry in the coming years.
“The growth and densification potential of the city centres has been exhausted, so that demand is inevitably shifting to new, suburban centres with good infrastructure and connections,” he said.