– GCC investors are projected to invest over $4 billion annually in UK commercial real estate, driven by falling interest rates, improved affordability, and new market opportunities.

– Purpose-built student accommodation is a popular investment due to the growing number of Gulf region students in British universities, with over 8,000 GCC students currently enrolled, doubling in the past five years.

– The UK market is poised for a “once-in-a-decade economic alignment” with factors such as interest rate cuts, a new government, and opportunities to upgrade assets to meet new environmental standards, enhancing investment appeal for GCC investors.

GCC investors are projected to invest more than $4 billion annually in UK commercial real estate, spurred by falling interest rates which enhance affordability and outlook.

The Bank of London and The Middle East (BLME) highlighted that purpose-built student accommodation is a favored asset due to the increasing number of Gulf region students at UK universities.

According to BLME, the UK market is approaching a “once-in-a-decade economic alignment,” presenting new opportunities for GCC investors due to interest rate cuts, a new government, falling inflation, and declining property prices in certain segments.The Bank of England (BoE) reduced its base rate from 5.25% to 5%, marking the first cut since 2020 after a series of rate hikes to combat inflation.

BLME’s report on UK property investment from the Gulf states that 87% of surveyed investors believe that falling interest rates will drive GCC investment appetite over the next year, indicating significant pent-up demand. Additional factors include a “green premium” from upgrading assets to meet new or expected environmental standards and opportunities in the living sector driven by demographic changes and a shortage of residential properties.

Rashid Khan-Gandapur, Director of Real Estate Finance at BLME, expects overall investment in UK commercial properties to exceed $4 billion annually.

This figure is likely to increase with growing GCC investment in the residential sector, as investors show a strong interest in large-scale living sector projects.

A majority of respondents, 68%, reported that their investment clients are particularly focused on the student accommodation sector, citing a structural shortfall and low tenant failure rates.

The BLME noted that over 8,000 GCC students are currently enrolled in British universities, a number that has doubled in the past five years, according to the Higher Education Statistics Agency (HESA).