If there is no bad news one day, it will surely come next. Whether as a property
developer, owner and/or investor, recent economic and market events are enough to leave you sleepless. Severe anxiety and stress caused by economic post-pandemic after-shocks allied to the repercussions of the ongoing war in Ukraine have led to above-average inflation and recent steep rises in UK interest rates. It could be a more pretty picture.
Despite the headwinds, opportunities for growth and a good return on investment still exist even if the equation of what constitutes a good deal has changed. The UK real estate market is always evolving, and 2023/2024 will reward those who evolve their portfolios. Demographic priorities are shifting. Residential real estate – build-to-rent (BtR), purpose-built student accommodation (PBSA) -
remains highly prized, seen as having more income stability than commercial sectors. Specialised sub-sectors generate specific interest, such as retirement and senior living developments for ageing populations.
The rise of ESG is the brightest driver of change. The real estate
sector, from construction to finance to operations, makes environmental, social, and corporate governance concerns crucial to business decisions. This includes everything from reducing emissions to diversity and inclusion within organisations. Investors and lenders see the importance of creating social impact alongside financial return.