The requested news item does not exist. Please return to News
International residential developers are expected to increase their pipeline significantly as City of London sales continue to grow, JLL reports
The Central London residential market has become increasingly attractive to Middle East investors according to the latest Central London Residential Development Research Report published by JLL, the world's leading real estate investment and advisory firm.
International developers are taking on some of London's largest and most high-profile development opportunities. And while they control only nine of the largest 50 development sites with planning in Central London, these sites equate up to 28,000 new homes. This already represents around 20% of the total planning pipeline in Central London, and JLL expects this to grow significantly over the next few years.
Within the City of London, or the 'Square Mile', there has been substantial market growth in recent years, with property prices increasing 15.3% over the past 12 months. In 2013, there were 12,000 units sold, marking a 63% rise from 2012, and housing starts soared by 97% from 6,800 units in 2012 to 13,500 units last year.
One of the best performing schemes in this market has been The Heron, which has profited from the rising London property market. Prices have increased by as much as 40% since the development launched in 2010 and the scheme has performed exceptionally well in terms of sales with only a selection of the Penthouse Collection now remaining.
Adam Challis, Head of Residential Research at JLL, comments: "Middle Eastern investors have strong historic links to the London property market. London's position as a capital city and financial centre, alongside its stable political system and transparent legal framework, continues to attract interest from across the Middle East. Whilst questions will often linger about the sustainability and depth of demand, the lack of supply is undoubtedly the most important factor for ensuring that the Central London development market will thrive over the next three to five years. Even if market conditions ease, as they will do at various times, it will remain important for developers to continue building and releasing product to feed this fundamental housing need."
Diana Alam, Head of Development Sales & City Residential Office at JLL further comments: "Demand from buyers in the City of London has strengthened significantly, with strong support from the overseas market. Given that London's financial district has 350,000 workers by day but only 8,000 residents, we are not surprised that there is high demand for housing in this area – particularly new developments. In the Square Mile, average price per sq ft is approximately 15 -22% higher than it was a year ago at £1,300 to £1,500, and prices are reaching highs of up to £3,000 per sq ft."
Head of UK Residential, MENA
+971 50 139 2000