Domestic investors have overtaken buyers from Asia as the most active group in London’s West End property market, although falling foreign interest could be behind the shift.
UK buyers accounted for 52 per cent on all commercial deals in the West End in the first six months of this year, rising from 42 per cent in the same period the year before.
The figures suggest the strongest buying activity by UK investors in the West End since 2007 when the group accounted for 51 per cent of the market by value.
Domestic investors also made up 45 per cent of value in the area, rising from 29 per cent in the first six months of 2017, according to the research from Savills.
However, UK activity in the West End property market has risen as a proportion in large part because of less competition from overseas buyers.
Paul Cockburn, head of the West End investment team at Savills, told City A.M.: “Overseas buyers were very active in the first six months of 2017, but more recently, as the pound has reached a more consistent level, the overseas money has dipped a bit.
“Last year was noticeably up in terms of volume because big transactions happened, whereas this first half there have been very few of those transactions. Last year was above average and this year we’re a bit below average.”
While there were nearly 70 transactions in the first six months of 2017, amounting to £3.73bn of assets, that fell to £2.9bn of assets across 58 deals in the first half of this year.
Yet Cockburn insisted there is still a strong appetite for commercial property in London among domestic investors.
He said: “Turnover is down slightly but values are robust and in most people’s eyes they are surprisingly robust. A lot of people have been selling in anticipation that values would fall in this period and that hasn’t proven to be the case.”
Earlier in May this year the Burlington Arcade in Mayfair was sold to Motcomb Estates, the UK vehicle for property tycoon brothers Simon and David Ruben, for £300m.
Cockburn added: “Of the thirteen sales we have managed in the first six months eight have gone to UK buyers. These investors, who have been out of the market until recently, reflect a wider sentiment that it’s business as usual in London.”