London Has Arrived: A UK delegation travels to the UAE to pursue real estate deals. qatarsales
A government-led delegation of UK investors and developers is planning a trip to the Middle East to strike deals with investors as they continue to pour money into the UK following Brexit.
They will participate in two special events aimed at strengthening investment and trade ties between the two regions, as total foreign investment into the UK from the Middle East surpassed AED 15.1 billion in 2016.
Though Middle Eastern investors have historically been attracted to residential property in London, the Qatari government's AED 18.4 billion boost to its AED 229.5 billion real estate and infrastructure investment portfolio in the UK this month shows that the appeal is much broader.
The UK delegation is led by Sir Edward Lister, the chairman of the government's Homes and Communities Agency.
"The Emirates have always been strong investors in the UK, not just in London, but throughout the world, and that investment has always been welcomed," he said.
After Brexit, the UK's property market trends remain unchanged. The demand for all forms of real estate is extremely high. The UK government's housing target is 250,000 homes a year, but we're only getting 170,000 in a good year, so there's a lot of pressure on housing around the country, and we need modern office space, as well as industrial and distribution warehousing. The UK is still a good investment in a country where property is so well covered by the rule of law."
Sir Edward, who is also a former deputy mayor of London, said he was looking forward to meeting with Middle Eastern experts to learn about the latest developments, especially next-generation construction methods, which could benefit the UK.
The UK's trading relationship with the region spans two centuries, and the unique relationship between the UK and the Gulf is expressed in the region's booming trade figures.
Between 1999 and 2015, trade between the UK and the GCC increased by 185 percent, with the UAE being the UK's third largest export partner outside of Europe and 11th largest trading partner overall. The UK's foreign relationships are likely to be strengthened and nurtured in the aftermath of Brexit.
"We already know that London residential property is a favorite asset class among the region's affluent, as our Middle East Private Capital Surveys have shown for a number of years," said Faisal Durrani, Head of Research at Cluttons. The 'eighth emirate' moniker is backed up by the massive amount of investment it attracts from the Middle East, especially the Gulf Cooperation Council states."
"In addition to Qatar's multibillion-dirham investment in the UK, Kuwait's Kamco and Dubai's Rasmala recently concluded an AED 248 million deal to buy an Amazon distribution warehouse near Edinburgh, which is responsible for three out of every eight Amazon parcel deliveries in the UK. And Abu Dhabi Investments recently bought a 1.4 billion AED stake in a Liverpool shopping mall."
The Rt Hon Liam Fox MP, the UK's Secretary of State for International Trade, recently published an article for EG in which he said that it was important for the UK to continue to attract foreign investment.
"In order to fully realize our ambitions, the DiT will fully support the property industry by matching investors with projects and facilitating flows of foreign capital through investment opportunities across the country," he wrote.
Developers in Dubai are also encouraging foreign investment.
"There is a very attractive business model here in Dubai," Sanjay Manchanda, the chief executive of one of the world's leading developers, Nakheel, said. To reduce risk, everyone needs a well-diversified portfolio. Dubai rates are very affordable and much lower as compared to those in Hong Kong and Singapore, New York and London. In Dubai, real estate returns are currently around 5-10%."
"While the United Kingdom will always be seen as a safe haven for investments, the dizzying speed at which cities in the Gulf have risen is attracting the attention of the global investment community, especially when you have mega projects like the USD32 billion Al Maktoum International Airport in the works, as well as ground-breaking new transportation infrastructure like 3-D pylons," Durrani continued.
The Middle East Real Estate Forum, which includes two set-piece events designed to strengthen investment and trade ties between the UK and the Middle East, will feature Sir Edward Lister, Sanjay Manchanda, and Faisal Durrani.
The events will take place on April 25 in Abu Dhabi and April 26 in Dubai.
They are being coordinated by global real estate publication EG, which is collaborating with the UK Department for International Trade and international real estate advisor Cluttons to highlight Abu Dhabi, Dubai, and the UK's global ambitions.
The events will include a number of well-known speakers who will share their perspectives on best practices in large-scale regeneration, growth, and infrastructure delivery.
"This investor tour of the Middle East is taking place at a really exciting time," said EG Editor Damian Wild, who will chair the events. The United Kingdom is at a pivotal point in its modern history, and the Middle East is one of the most complex business environments on the planet. Senior figures from the UK real estate industry have jumped at the chance to join the delegation, which plans to explore business and investment prospects in Dubai and Abu Dhabi. The delegation's investment opportunities will span the length and breadth of the United Kingdom, and will include anything from residential to industrial to infrastructure. We hope to expand on the popularity of our first forum, which we co-hosted in Dubai three years ago, by collaborating with Cluttons once more. We appreciate the Department for International Trade of the United Kingdom's assistance as well. Many of the delegates who are traveling with us to the Middle East were already on a similar trip to New York and Toronto with DIT last year."