Superrich individuals battle with institutional investors for commercial property

Purchasing top-notch commercial properties in London is more competitive than ever with superrich individuals prepared to pay hundreds of millions for single office buildings.

Prior to the financial crisis, paying so much for just one building was the preserve of global funds, but now wealthy individuals are looking to make such investments, alongside prime property options.  

London property is appealing because many billionaires look for laws that side with property owners, an expanding economy and the UK is also politically stable and business-friendly. The market also tends to rebound pretty quickly and holds its value in the long-term.

This influx from overseas investors has pushed office yields up to 4.8% in the fourth quarter, lower than before the financial crisis, according to data from MSCI’s IPD UK index. During the last property boom in late 2006 and early 2007, yields touched as low as 4.9%, the data show.  

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Wall Street Journal