Real estate investors look for shelter for Brexit’s finance refugees
A property company managed by Schroders Plc. is bidding for an office building in Frankfurt, anticipating a boost in the German financial center as a result of banking fallout from Brexit.
The London-based property investor isn’t alone preparing for an exodus from the British capital, with both CBRE Global Investors LLC and Standard Life Plc. looking for office space across Europe.
On the proposed Frankfurt acquisition by Schroder European Real Estate Investment Trust Plc., Tony Smedley, a fund manager at Schroders, said, “The potential additional growth as a result of companies relocating from the U.K. enabled us to be firmer on pricing and financial underwriting”.
Those seeking to move overseas face a problem as the lack of development and growing domestic demand have already pushed vacancy rates for prime space in the business districts of Paris, Frankfurt and Amsterdam to the lowest levels in about a decade, according to broker Savills Plc.
Real estate investors are now seeking to capitalize on that shortage by buying partially vacant offices and plots and developing them as per requirements of banks.