When the Brexit cloud that is hanging over the UK dissipates, investors will wish they had deployed their capital in the British market when the time was right, delegates heard at Real Asset Media’s European Outlook Briefing which took place in New York last week.
‘Brexit is a buying opportunity,’ said Alexander Fischbaum, Managing Director, AF Advisory. ‘My advice is look at the underlying factors and don’t get too scared about the noise. The UK is a strong nation that will bounce back.’
Political risk will undoubtedly manifest itself over the next two to three years and it will have reverberations across Europe, not just the UK, he said. ‘Even if you don’t want to commit capital in the short term because of the uncertainty, watch the market very closely. It will be a bumpy ride for a while, but it will present very nice opportunities.’
There is a huge range and number of international investors in the UK, from US pension funds to Asian family offices to Middle Eastern sovereign wealth funds to ultra-high net worth individuals from across the globe. But the current uncertainty over Brexit has led some investors to pull back which creates openings for eagle-eyed investors, especially in the core and core plus sectors.
‘London has the Brexit problem, but Asian investors are heavily invested there so they are clearly not afraid,’ said Carsten Loll, Partner, Linklaters.‘Europeans, including Germans, are much more cautious and I tend to share that view. But there are still opportunities to be found in the West End, for example, while I would stay clear of Canary Wharf.’
The UK capital also has an advantage over most other European cities, he said: ‘London is a fantastic city where people want to be. From a lifestyle point of view, somewhere like Frankfurt cannot compare.’
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