Opinion

EXPO REAL 2009 BLOG 3: The UK is already over

In his third blog from the EXPO REAL conference in Munich, PERE's European editor Robin Marriott discovers the window is closing on UK real estate.

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Okay, I exaggerate by saying the UK is over before it has properly begun, but AEW Europe’s chief executive, Christian Delaire, made clear to me yesterday his view that the window will not stay open that long.

Here’s what he actually said: “In the UK we have been very active over the last 12 months. We are still actively seeking select opportunities but the window may close soon because of the huge amounts recently raised to target this market.”

That is not as confusing as I first supposed. Yesterday, upon arriving at EXPO it was evident many people are trying to buy property in Britain. As Christian points out though, this is leading to some price inflation because in some cases demand outweighs supply.

So what about elsewhere in Europe then?

Well, he says in both France and Germany, AEW has seen some movement with increasing caps rates, but the big question in both markets is about rental values and whether these can hold up. He comments:  “We are watching market developments in France and Germany very carefully and will be ready to move if we think it makes sense.”

That’s a big ‘if’.

That said, I was hearing recently from a very seasoned US developer and fund manager that they are close to re-entering France.

I better go and find some French asset managers to see why this might be a good idea.