Investors are planning to allocate more money to residential assets

Investors are planning to allocate more money to the purchase of residential assets in Europe this year, JLL shows.

This type of investment is set to grow throughout 2021, following the robust performance of the market throughout 2020, which resulted in €83.4bn being invested into the sector.

Living assets made up 13% of asset allocations from respondents, with that set to increase to 21% if full investment ambitions were realised.

With only 11% of respondents looking to decrease their allocation to Living assets, the hunt for suitable stock to invest in is becoming increasingly competitive.

The percentage of respondents looking to increase their allocation to Living assets has grown steadily since the first Living Investor Survey from 41% to 59%.

While investors are determined to increase their allocation to the sector, 78% have identified a lack of suitable product as being a major barrier to accomplishing this.

While only 8% of respondents have exposure to all five sub-sectors of Living assets, JLL’s forecast expects this to grow to 27%.

Clearly there is a substantial shift towards diversifying investments in the Living sector, and investors will be growing operational expertise to meet these ambitions.

Not only are investors looking to diversify within Living assets, but nearly two-thirds (63%) of respondents said they are looking to expand to at least one additional market.

Addressing barriers to entry from an investment perspective, 78% of respondents identified a lack of suitable product as restricting them from investing.

This is evidenced by the fact that 30% of all purchasing activity in 2020 was for assets not yet completed.

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