GCC investors continue to view London as an attractive real estate investment destination, according to research conducted by UK’s Shariah compliant Al Rayan Bank.
Al Rayan Bank’s 2024 GCC Investment Barometer – which surveyed 150 investors from Saudi Arabia, Qatar and the UAE, with an average net worth of US$13 million – found that respondents invested US$112.45 million in London properties in 2024, compared with US$90.79 million in the previous year, an uplift of almost a quarter (24%).
This figure is up 33% from US$69.14 million in 2023 when the same research was conducted, with the most common reason for choosing to invest being the desire to relocate to the UK or to have the option of living there, although this drive fell from 72% to 53% year-on-year, potentially from early uncertainties around government policy, said Al Rayan Bank in its second annual survey of GCC property investors.
Most notably, all of the investors surveyed confirmed that they plan to make new investments in, or widen their exposure to, the UK property market over the next five years, committing to spend an average of US$92 million in the UK property market – with 43% targeting Central London, with Greater London (40% up from 31%) and West London (38%, up from 31%) the next most popular areas.
Investors are looking farther with Liverpool (35%), Manchester (29%), Cardiff (21%), Birmingham (20%) and Bristol (19%) named as the top five destinations outside of London (54%).
The majority (59%) are targeting residential apartments (unchanged), 56% looking at commercial office space (up from 52%), 47% residential housing (down from 49%) and 46% mixed-use developments (up from 40%). Also, 48% of respondents said access to green investments makes London an attractive investment target.
Al Rayan Bank Chief Commercial Officer Maisam Fazal enthused the introduction of visa-free travel for GCC nationals will further enhance the UK property markets appeal, but expected some short-term uncertainty from the impact of the new UK government’s capital gains tax and stamp duty.
Such robust demand from GCC investors is in line with global findings from Knight Frank, which found that London was 2024’s top metro destination for total cross-border investments at US$9.6 billion while the UK also topped the list of international destinations for such investments at US$26.2 billion. London also reclaimed the number one spot for overseas private capital from New York.
Demand is outstripping supply in the luxury home segment, whose new-build activity is currently running 25% below the 10-year average. Appetite for prime office space is also significantly large.
“Knight Frank counts 62 live requirements, each looking for upwards of 50,000 sq ft. Waits of up to three years to occupy space are common,” noted the Knight Frank Wealth Report 2025.
Knight Frank said the interviewing of 150 single and multifamily offices across the globe through November and December 2024 found that 44% of respondents expect to increase their exposure to real estate over the next 18 months.
For UK specifically, this consultancy expected “a high presence of cash buyers and rising levels of global wealth mean price growth should strengthen over the next five years”.
UK Residential Research Head Tom Bill projected that the north London neighborhood of Islington – dotted with Georgian terraced houses and Victorian villas – plus the easy access of Sevenoaks, Kent located within a 30-minute train ride from the capital city will be popular investment choices.
Other real estate targets for the year ahead, as highlighted by respondents to the Al Rayan Bank survey, are Hong Kong (29%), Monaco (27%), Tokyo (26%), New York (25%) and Paris (25%).
Meanwhile, Knight Frank said that with interest rates likely to shift lower, modest growth is forecast in 2025 for most prime housing markets in Dubai (+5%), Geneva (3%), New York (3%), Paris (2.5%), London (2%) and Sydney (1%). Hong Kong, Miami and Singapore are expected to post no growth.
