Global investor appetite in Living assets set for 30% growth, says new JLL research
Dynamic sector achieved total investment volumes of €69 billion in 2018 with Germany and the UK attracting a dominant share of capital
London, 31 May 2019 – New research released today by JLL reveals an optimistic year ahead for real estate investment in Europe, with Living predicted to achieve 30% growth this year.
According to the inaugural JLL European Living Survey, the Living asset class - which brings together student housing, coliving, multifamily and healthcare real estate assets – is set to thrive as 8 in 10 investors look to expand into new European markets. This could inject as much as €40 billion of new capital into the sector, which last year reached €69 billion.
The success of Living is being led by investors looking to capitalise on changing demographics, such as increasing student numbers, declining household sizes, urbanisation and an ageing population. Based on current investment allocations, multifamily is the most popular sector within Living, although 75% of survey respondents expect investment volumes for coliving to increase at the fastest rate.
The report also signals investor commitment to socially-conscious real estate assets. Sustainability is set to influence Living investment decisions, with 80% of respondents agreeing that capital allocations will have greater exposure to sustainable assets.
Guy Grainger, CEO, EMEA, JLL, said: “The investment landscape in Europe is changing, with demographic, social and economic drivers bringing greater focus on Living asset classes.
It’s a dynamic market and our approach of combining student and healthcare property with more traditional residential assets under our Living advisory team, gives our clients a simple yet effective opportunity to leverage future growth across these fields whilst also aligning with current and future real estate trends.”
Based on current and intended investment, the UK is the most appealing market for Living, with 79% of investors either already invested or targeting the country as a growth market. The most in-demand markets for new investment are France, the Netherlands and Sweden, closely followed by Spain and Ireland. 82% of investors have opted for direct investment into Living as their route to market while 38% use private real estate funds.
Adam Challis, Head of EMEA Living Research and Strategy, said: “Set against the backdrop of macroeconomic and political headwinds, the story for European real estate markets remains strong. Within this context, Living has emerged as one of the most exciting opportunities in the region.
Our survey is the first of its kind and a key platform to anticipate the market evolution. The results indicate growing appetite for this asset class in Europe, and we predict that Living is set to experience strong continued capital inflows in 2019.”
The JLL European Living Survey is based on a survey of more than 50 global investors representing over €3.2 trillion in assets under management.
JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. Our vision is to reimagine the world of real estate, creating rewarding opportunities and amazing spaces where people can achieve their ambitions. In doing so, we will build a better tomorrow for our clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of $16.3 billion, operations in over 80 countries and a global workforce of over 91,000 as of March 31, 2019. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated.
The European Living Survey was compiled in collaboration with Aberdeen Standard Investments, based on a survey of 50 investors representing over €3.2 trillion in assets under management (AUM). It encompasses a varied group, both in terms of scale and type of investor. However, they share a common interest in European Living opportunities, with 78% already invested in the sector.