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Future Living Report 2023

Our two yearly poll of global institutional investors reveals that the prospects for the next decade remain very strong. Four years on from the launch of our first Future Living report, we continue to see an evolution in how real estate investors are looking at the Living sector.

Part of the market where we have held the strongest conviction over the past decade is providing nearly £1.5 billion of senior investment and development finance, primarily in the PBSA and Build-to-Rent sectors. Encouragingly, our poll of 50 global institutional investors reveals that the prospects for the next decade remain very strong, despite the ongoing macroeconomic volatility and the lingering influence of the Covid-19 pandemic.

Perhaps the biggest question is whether investors will be able to execute on their intentions. In the face of the most restrictive financing backdrop since 2013, our report shows that investors are having to rethink their funding approach. And, unlike other commercial real estate (CRE) sectors, respondents believe that yields have remained, and look set to remain, relatively tight, creating additional challenges.

Download the full 2023 report PDF 2.18 MB

Key survey results

62%

Almost two-thirds of respondents (62%) said they expect their portfolio allocation to the Living sector to increase over the next five years, compared with just 40% in 2021.

£248m

Investors plan to invest an average of £248m in the Living sector over the next 12 months, more than double the £113m from the 2021 report.

59%

Student accommodation has risen from tenth to first in terms of investor appeal – 59% of respondents are optimistic about student accommodation compared with just 27% in 2021.

71%

Nearly three-quarters of respondents (71%) said that it will be more difficult to access asset-backed, senior debt over the next 12 months.
 
Research methodology

Research was conducted by FTI Consulting online from 14-27 July 2023, with n=50 global institutional investors investing in UK real estate representing £442 billion in global assets under management.

The convention on rounding was followed, so sums may not always add up to 100%. For more information on the research methodology please contact: Dan Healy dan.healy@fticonsulting.com

Contact us

Jonathan Long

Jonathan Long

Head of Corporate Real Estate

Jonathan is currently Head of Corporate Real Estate lending responsible for over £1bn of loan assets, and specialises in providing debt finance for PBSA, residential and industrial projects.