Dubai: Be they trophy assets or more prosaic warehouses, the Gulf’s institutional and high networth individual investors are out shopping for realty across Europe and whichever geography that catches their fancy at that moment. And when it comes to serious wealth, the region’s sovereign wealth funds are already engaged in the heavy hitting by picking up one choice real estate after the other.

London remains an entrenched favourite and developers and sellers are doing their part to keep the inward interest ticking along nicely. “We’ve certainly not seen a decline in the quality and quantity of properties being brought to the market place by London developers,” said Robert Bartlett, CEO of Chesterton Global Ltd. “And indeed there has recently been a small increase in good quality second-hand stock in the market.

“Certainly, some of the ultra-prime property is sold off-market — but in many such transactions Chesterton has either represented the buyer or vendor.”

UK developer representatives are at Cityscape Global scouring for potential buyers. One such is South Quay Plaza — to be located at the London Dockyards and which will be the UK’s tallest residential scheme. Berkeley Homes South East London Ltd is the developer.

Planning permission was received in April and construction is scheduled for a January start. Completion of the first phase is set for 2020. Apartment prices are from Dh3.67 million.

And if it’s heritage London living that pleases a Gulf investor more, he can have that through “The Hempel Collection”, a set of 33 homes located close to Hyde Park. Being developed by Amazon Property and publicly-listed British Land, a three-bedroom apartment starts from £3.5 million (Dh19.7m).

Even as the onrush of Russian and Chinese buyers scampering to acquire UK assets as soon as they hit the market has subsided, Middle East investors are holding their own. In fact, based on agency estimates, they are now the second largest demographic purchasing residential property in prime Central London after the British, and up 11 per cent from a year ago.

Inward investment

Even concerns brought on by the oil price slide seems to be working in London real estate’s favour. “The recent drops have also shown people that putting money in longer term more stable commodities such as property is a wise move,” said Bartlett. “Inward investment to London continues to pick up from the Middle East.

“Rental yield here in Dubai are certainly higher but I expect overall total returns are still well ahead in the UK and I expect this to be maintained for the next few years.

“We’re still experiencing strong demand from other CIS countries outside of Russia, and despite the Chinese stock market turbulence people do find security in London residential as an investment class. Many statistics show this historically performs better than stock markets and commodities.”

But investors need to sift through locations before they home in on the ideal buy. Prime central London (Zone 1) has gone through a “slight” softening in residential capital values. But, according to Bartlett, there is “still significant growth” to be had in Zones 2, 3 and 4, “where we have seen further double digit growth so far in 2015. The mismatch between supply and demand will continue to underpin a sustained and steady growth profile.”