One third of UK commercial buildings have foreign ownership

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by Kay Murchie

According to research from Royal & Sun Alliance, a third of commercial properties in the UK are owned by overseas-based investors. However, the insurer said the ratio will decline slightly as real estate prices slow over the next 12 months.

Foreign landlords directly own 22% of all commercial real estate, compared with 15% seven years ago, before foreign buying of UK property really escalated, fuelled by demand for office buildings with sitting tenants on medium-term leases.

The report said that an additional 10% of all commercial buildings were owned indirectly through funds, while overseas businesses with a presence in the UK owned 1%.

Investment in UK commercial property is set to continue increasing in the longer-term but will ease in the short-term as the as ongoing pressures in financial markets filter through into the wider economy the report said.