GCC investors are likely to invest £2.5 billion ($3.21 billion) in the UK’s real estate sector in 2024, Shariah-compliant Bank of London and The Middle East (BLME) said in a new report.

GCC investments in the sector are likely to increase as investors from the Gulf states capitalise on lower asset prices across the UK’s residential and commercial assets, driven by the strength of the Gulf economies and their need for asset diversification.  

The mix of declining UK property prices, favourable exchange rates and rapidly accelerating growth in the GCC has led to pent-up investor demand, BLME stated, adding “greater affordability” is among the most important factors driving appetite for UK real estate.

London remains the city of choice, but GCC investors are scanning other regional towns and cities such as Manchester, Birmingham, Newcastle and Bristol.

“For GCC investors, the UK remains an attractive prospect despite geopolitical and economic uncertainties,” said Andy Thomson, Head of Real Estate Finance and Investments at BLME.

With a perfect storm of strong dollar-pegged GCC currencies, surplus cash following last year’s oil boom, and falling UK asset prices, investors in the Middle East have a golden opportunity to spot a bargain as property prices remain low, he said.

(Editing by Seban Scaria seban.scaria@lseg.com)