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real estate investors
Real Estate Investment Trusts
Jones Lang LaSalle
Mark Wynne Smith
retail warehouse sector
The commercial leisure market has had its best year since 2007 in terms of the level of investment ploughed into the sector during 2011, it has been revealed. Research published by Savills found that around GBP 700 million (excluding pure hotel deals) has so far been transacted this year, with UK funds accounting for GBP 123 million of this. UK real estate investment trusts (REITS) have purchased GBP 195 million of leisure assets, with the organisation noting the resurgence of REITS is "perhaps a reaction to occupational wobbles in the retail/retail warehouse sector and also the search for long-dated income with a growth/asset management story".Savills went on to predict that real estate investors will continue to be attracted to the commercial leisure sector in 2012, adding that investment will be concentrated on "the better schemes". However, the firm warned trading volumes will be dented by "a lack of institutional vendors" entering the market. Meanwhile, tenant demand is expected to be "fragmented" next year, as it has been so far in 2011, with some leisure organisations on a path to expansion, while others are focusing on downsizing their operations. Last month, the Jones Lang LaSalle Hotel Investor Sentiment Survey noted there was a slowdown in this part of the leisure market during the second and third quarters of 2011, but asserted that there will still be "some trading performance growth" over the coming six months. Investors are likely to focus on assets in London, Istanbul, Munich and Paris, the organisation found, while Stockholm and Copenhagen may also attract further attention from those with available funds. Respondents to the study have also indicated they have strong buying intentions, with chief executive officer of Jones Lang LaSalle Hotels in Europe, the Middle East and Africa Mark Wynne-Smith commenting: "The return of buy intentions to the top of investors' strategy lists indicates a potential turning point for the hotel investment market as it coincides with a marked increase in the number of hotels available for sale."
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