UK institutions invest as banks release stock
Institutional investors made their largest net commitment to the UK property market for more than three years during Q1 2010, according to new research from Lambert Smith Hampton.
The group’s quarterly UK Investment Transactions (UKIT) report says institutional net investment in UK property was more than £1.1bn, compared with £0.3bn in Q4 2009.
Ezra Nahome, CEO and head of capital markets at LSH, said: “We have been waiting for the banks to begin releasing stock onto the market, and it looks like this process has begun. Many of the sellers in the first quarter have been highly geared property companies. Banks chose not to foreclose on these loans in the bad times but have waited for a recovery in values before looking for repayment.”
LSH said some investors had also taken the opportunity to lock in profits as values had risen over the quarter.
The group expects recovery to remain “slow but steady” as the year goes on. Ezra noted that while the occupational market – a key investment driver – was showing signs of improvement, investor confidence would remain subdued until after the General Election result had become clear.
