LONDON — Global instability and a weak pound is driving a foreign investment boom in London's office market despite the risks of Brexit, according to half-year results from Savills published on Thursday.
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Global instability and a weak pound is driving a record foreign investment boom in London's 'secure' property markets
Increasing levels of global instability have pushed investors towards income-producing assets, including commercial property.
Terraced houses in Mayfair, London
The estate agent said in a statement that increasing levels of global instability have pushed investors towards income-producing assets, including commercial property.
In particular, the London office market saw nearly £9 billion of transactions in the six months to June 30, a record 78% of which were non-residents.
Savills said: "Many of these investors, while they accept that occupational risk has increased due to Brexit, still see the UK as comparatively secure in a global context."
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Weaker sterling, which fell in the wake of the EU referendum in June last year, has also made UK real estate a more attractive investment, particularly from the Asia Pacific region.
Savills, which operates globally, said underlying profit rose to £32.4 million in the half-year, up from £25.5 million in the same period in 2016, driven by strong growth in Asian markets and a "resilient" UK performance.
Revenue — over two-thirds of which comes from outside the UK — rose by 15% to £714.4 million, and its interim dividend was hiked by 6% to 4.65 pence.
Shares were up over 2% on the announcement at 9.05 a.m. BST (4.05 a.m. ET):
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