Jones Lang LaSalle’s alternative investment seminar predicted that investment in alternative property assets in UK will reach £20 billion by 2019.
The forecast, which is almost double the £11 billion of investment recorded in 2014, suggests that investment in alternatives will take up 30% of all UK property transactions by 2019.
Statistics based on a survey of JLL investors looked to determine which assets may draw investment over the next 5 years.
The survey showed that 90% of investors plan to dip their toes into the alternative market, with respondents looking to increase their allocation to alternative opportunities by around 9%.
“Alternative asset classes are becoming increasingly attractive to institutional investors, with a particularly positive outlook forecast for the next five years,” Chris Ireland, UK chairman and lead director of capital markets at JLL commented on the survey’s findings.
JLL stated that investor interest could increase by 82% as the alternative market becomes more acceptable to institutional investors.
Higher yields – when compared to mainstream opportunities – and a greater knowledge of alternatives may also drive investment sentiment.
A 70% increase is set for opportunities to invest in student accommodation, a 69% increase in hotels and hospitality and a 66% rise in healthcare investment may take place over the next 5 years.
“As we move towards 2019 and beyond, with what indicates to be an ever-increasing investor appetite, it is likely many of these assets will break out of the alternatives bracket and become a more mainstream choice for investors,” Ireland added.