Europe’s Real Estate Investors Put Their Faith in the Office

(Bloomberg) -- The coronavirus pandemic has triggered an intense debate about the death of the office. Real estate investors aren’t buying it.

Offices topped a list of targets among 415 European real estate investors polled by CBRE Group Inc., the world’s biggest broker. More than a third picked offices, ahead of just under a quarter who preferred rental housing and 22% for warehouses, according to the survey, which was published Monday.

The results contradict the growing narrative that the move to work from home ushered in by the pandemic will permanently undermine the value of office buildings. While some companies are planning sweeping cuts to the amount of space they occupy, others are continuing to commit to new premises.

“The pendulum is going to swing,” James Beckham, managing director for CBRE’s London investment business said. “People are going to want to and be willing to come back into the office and investors are buying into the long term.”

London ranked as the top destination among investors looking to spend money in Europe, the survey found. The U.K. capital topped the list ahead of Berlin, Frankfurt, Paris and Amsterdam, the broker’s data show.

“The certainty around Brexit has changed the mindset of some investors and pumped a renewed confidence into the London market, where we expect to see a lot of European capital deployed over the next 12 months,” CBRE managing director for EMEA capital markets Chris Brett said.

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