“Asian investors pour record sums into London offices,” reads a Financial Times headline.

 

As much as 90% of investments in London commercial property in the last quarter came from overseas, it says.That sounds promising. It would seem Brexit has boosted rather than deterred foreign investment in the capital.But before Prime Minister Theresa May and Chancellor Philip Hammond uncork the champagne, they might want to take a closer look at the figures.

 

“Investor sentiment towards UK commercial property has been indifferent,” says David Stevenson, Investment Director at Strategic Intelligence.

 

Asian investors like the look of London.Hong Kong company Lee Kum Kee set a record when it bought the “Walkie Talkie” building for £1.28bn in July.The price the Asian food conglomerate paid was exceptional, but other than that the transaction forms part of a trend.

 

Foreign investors love the UK commercial property market. So much so that they pour in more money in London’s brick and mortar than UK investors.Two thirds of a total £4.8bn invested in London office space came from Asian investors last quarter.

 

In total foreign investors accounted for 90% of these transactions, figures from CBRE Group show.Why is that? Well, one obvious reason would be the pound’s drop in value.

 

“The post-Brexit decline in the pound has made sterling-priced assets more attractive for international buyers, says David Stevenson.“I’m not surprised that these have been snapping up British buildings more cheaply.”

 

Since the EU referendum, the value of British currency has fallen significantly and this makes investments in the UK cheaper to overseas investors.Foreign investors now get more for less, so to speak.Another reason is that a lot of foreign investors simply see an opportunity to park their money in a safe place.

 

“Chinese investors fear greater capital controls being forced on them,” writes Aime Williams in the Financial Times.“In August, the government implemented regulations targeting ‘irrational’ investments in overseas sectors including property.

 

“Although Hong-Kong companies are not subject to these curbs, many fear the impact of potential Chinese market instability and so are moving cash.”This would explain why Asian investors have become more prominent when it comes to investing in British commercial property.

 

Either way, Theresa May and Philip Hammond will be glad to see that foreign investment keeps flowing into the country.It will confirm to them that Britain stays an attractive destination for foreign capital.With the Brexit negotiations in a deadlock, it’s a welcome piece of good news.

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