Brexit Uncertainties Put $57 Billion Fund Off London Real Estate
A $57 billion Finnish fund that’s increasing its real estate holdings said there’s one market it’s definitely not touching, and that’s London.
Since the Brexit vote in June 2016, Ilmarinen has bought real estate in Amsterdam, Berlin, and the U.S. It also has holdings in Brussels and Frankfurt, and acquired about 50 percent of a new office property at the heart of Manchester in late 2017. But investing in the U.K. requires getting “a higher risk-reward than investing in Brussels and Berlin and Frankfurt,” Mursula said.
“We ended up at higher yields from an investor perspective than we would have ended up with in London,” he said, adding the quality of the building and its tenants helped improve its appeal. “In this case, it looked much more attractive than a couple of those London opportunities we’ve been going through.”