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November 24, 2014

Investment in alternative real estate assets in the UK will hit GBP20billion by 2019, almost doubling from 2014 levels of gbp11bn, according to the latest predictions from JLL.

The 82% surge in investment volumes will occur as a result of factors including: alternatives becoming more acceptable to institutional investors, higher returns offered relative to conventional real estate and greater expertise in alternatives.
These statistics formed the basis of a JLL survey of investors, which looked to determine which areas of the alternatives market will receive the most investment over the next five years.

The survey results declared that 90% of investors plan to increase exposure to alternative real estate assets in the next one to five years, with respondents on average looking to increase their allocation to alternatives by 9% in the next 1- 5 years.
Key targets for investors will be student housing, which is set to see a 70% increase in investment, hotels and hospitality with a 69% increase, and healthcare, where investment is set to rise by 66%.

Speaking at the firm’s annual alternative investment seminar, Chris Ireland, UK Chairman and lead director, capital markets at JLL said: “Alternative asset classes are becoming increasingly attractive to institutional investors, with a particularly positive outlook forecast for the next five years.

“As we move towards 2019 and beyond, with what indicates to be an ever increasing investor appetite, it’s likely that many of these assets will break out of the alternatives bracket and become a more mainstream choice for investors.”

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