Investment in living assets will increase during 2021 after the strong performance of the market throughout 2020, when 83.400 million euros were invested in this sector. This is one of the main conclusions revealed by a new study by JLL.
Specifically, the third edition of Living Investor Survey consolidated the opinions of more than 40 participants who represented around 9.500 billion euros in total assets under management, of which 100.000 million euros are invested in living assets in Europe.
Living assets (student housing, shared housing, multifamily, affordable housing and health-care assets) accounted for 13% of the participants' asset allocation in 2020. This figure will increase to 21% if the investment targets are met. Since only 11% of participants plan to decrease their allocation to living properties, the search for assets suitable for investment is becoming increasingly competitive.
The percentage of respondents seeking to expand their allocation to living assets has increased steadily since the first edition of the Living Investor Survey. In this way, has increased from 41% to 59%.
Although investors are determined to increase their allocation to the sector, 78% have identified that the shortage of suitable products is the main barrier to achieve this. Furthermore, they don’t believe that the balance between supply and demand for investment grade opportunities will improve in the short term.
«In the last twelve months, there has been an acceleration of investment in these assets, as owners seek to reposition their portfolios, inject new capital into the sector and take advantage of the advantages it can offer», explains Jeremy Eddy, head of living, international capital markets, EMEA at JLL.
Although only 8% of the participants operate in the five living subsectors, JLL forecasts suggest that this figure will increase to 27%.