Part II: Europe’s trade associations pen open letter to policymakers on Brexit threats to real estate sector

In the second part of our summary of the major challenges for the European real estate sector as outlined by a consortium of sixteen trade associations and research bodies, we begin with the importance of maintaining European regulatory momentum.

The consortium of sector trade associations and research bodies – including INREV, EPRA, ALFI, ZIA, ASPIM, LUXREAL and IVBN – have identified six major challenges for the European real estate sector posed by Brexit which policymakers on both sides of the Channel must be mindful of.  Here are the second three:

  • Maintaining the momentum on existing initiatives: “While it is inevitable that significant resources and attention will now have to be devoted to the renegotiation of the UK’s relationship with the EU, this must not be allowed to derail or delay policy initiatives designed to boost private investment and generate growth that are already envisaged. The case for a Capital Markets Union (CMU), removing barriers to cross-border and long-term investment (including to real estate through the public markets) and reviving securitisation markets (including for commercial real estate debt) remains strong. For the real estate investment industry, the CMU has always been both European and global. The imperative to tackle obstacles to cross-border investment and market access, and to facilitate the flow of capital within the EU and between the EU and the rest of the world remain unaffected by the UK referendum result.”
  • A transparent and open process: “It is imperative that investors have the maximum possible clarity and certainty about the next steps. It is time for a clear roadmap to be agreed by the EU and the UK and communicated to stakeholders. This must include clarity regarding the scope of the negotiations and provide for appropriate stakeholder involvement.
  • Securing the skills base: “Professional services are at the heart of Europe’s economy and our future growth in this sector is dependent on our ability to import and export — or passport — such services throughout the Europe. The mutual recognition of qualifications and the development of common technical standards have reduced the barriers to cross-border services provision. These common approaches have also meant that European businesses can support best-practice in environmental, financial and social standards. Maintaining access and developing talents are critical to ensure the growth and competitiveness of the sector.”

The consortium added in its open-letter:

“Real estate investment makes a significant enabling contribution to economic activity, growth and job creation and helps create vital, liveable towns and cities. We urge policymakers to respect [these six] principles as they pursue the negotiations for the UK’s departure from the EU.”

james.wallace@realassetmedia.com