Property investors have warned that the UK would be a less attractive place to invest were it to leave the European Union, according to findings of a new survey by global property adviser CBRE.

As part of a CBRE special report Heading For The Exit?, published today, the survey* of investor clients reveals that sentiment has hardened against leaving the EU in recent years. CBRE has conducted this poll for three years. 2016’s results see a sharp reduction in those who think exiting the EU would make no difference to investment, from 33% in 2014 to 21% today. The proportion of respondents who think the UK would be a slightly worse place to invest has risen from 32% in 2014 to 46% in the latest poll, bringing the total that think the UK would be a worse place to invest to 73%, up from 69% last year.

The UK will hold a referendum on whether to remain in the EU on 23 June. CBRE believes investors and occupiers are likely to behave during the referendum campaign, in the same way as they did in Scotland during its 2014 independence referendum; by delaying decisions until after the vote. After the Scotland referendum there was a ‘catch up’ effect and CBRE expects the same for the UK, assuming that it decides to remain in the EU.

Miles Gibson, Head of UK Research at CBRE
According to our recent poll, property investors have, over the past three years, become increasingly gloomy about the impact of the UK leaving the EU. The UK has experienced record property investment in the last few years and the property investors we surveyed fear that a Brexit would adversely affect the attractiveness of the UK as an inward investment destination.

David Cameron’s reforms are likely to be useful, but not decisive, in affecting public sentiment. The most important concession that the Prime Minister has secured is to ensure that non-Eurozone countries are not discriminated against within the EU’s single market. This aims to ensure that key parts of the UK economy, particularly financial services, can continue to operate from the UK rather than having to move to the Eurozone.
Miles Gibson, Head of UK Research at CBRE

The report shows that the majority of experts feel that the UK would suffer economically from exit, but estimates of the impact on growth vary substantially. The majority view is that the UK property market would suffer an adverse ‘demand shock’ were it to vote to leave the EU.

Finally, the report argues that reductions in labour availability arising from migration controls will vary substantially because some sectors are more dependent on migrant labour than other. The food and hospitality sectors, for example, could be very exposed to labour market restrictions. The financial services sector is also exposed because of the potential change in the regulatory environment, and in terms of trade with the EU.

To download the full report please click here


*Survey based on 191 CBRE property investor clients, conducted online between 16 and 20 February 2016.