FUTURE OF LONDON “Foreign capital has never gone away. We just advised on the sale of 125 Old Broad Street, next to the Bank of England, for £385m to Singapore-listed City Developments.”
Speaking at EG’s Future of London conference this week, Andrew Hawkins, international partner at Cushman & Wakefield, highlighted a city buoyed by foreign capital that shows no signs of disappearing.
Only this week, it emerged CK Asset Holdings is in discussions to buy into Capital & Counties’ beleaguered Earls Court scheme. The Hong Kong company is controlled by billionaire Li Ka-shing.
But does it matter?
The panellists at the “Who Will Own London in the Future & Does it Matter?” session didn’t think so, with one slight caveat: the government should offer more support to the PRS sector.
Vaqas Farooq, real estate partner at Shoosmiths, said: “I don’t think it matters. We have seen increasing amounts of money coming from abroad for some time. However, increasingly, we also see local authorities directly investing in projects. We think they need to intervene more to make developments happen.”
Hawkins, who said 90% of his clients are from overseas, added: “In London, the volume of our housing stock is down to overseas capital.
“Foreign investors create more stock in the absence of government stimulus. I think the government should sponsor PRS and build large-scale communities and overseas capital should come in alongside that.”
In response, Chris Carter Keall, head of UK real estate at Oxford Properties, which is backed by Canada Pension Plan, pointed to the recent rise in funding from Homes England: “They are investing £1bn, so they are listening.”
In September, Barclays and Homes England launched a £1bn development fund to increase the pace and volume of housing provision.
The Housing Delivery Fund will be open to all and put greater emphasis on diversifying the housing market, as almost two-thirds of homes are built by just 10 companies.