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Real estate still lucrative for London lawyers

Posted by: Simon Porter 31/10/16
June’s Brexit vote has created an unprecedented backdrop for lawyers working in a number of specialisms, particularly real estate. Both the commercial and residential property markets were expected to plunge in the immediate aftermath, and while they both took hits in the weeks directly after the referendum, signs of confidence are already returning.

The invested and owner-occupied commercial market grew 11% to £871bn in 2015, surpassing the pre-recession peaks of 2006 and 2007, and the amount held by investors increased by 9% to £483bn according to the Invested Property Forum (IPF). One of the biggest contributors to the market’s success is the uptick in foreign investment, with overseas investors now accounting for 28% of UK investment property.

London is still proving an attractive proposition for commercial investors, with foreign investors taking a 61% share in the city’s office market. So it comes as little surprise that the majority of legal work in the real estate sector of late has derived from the continued flow of foreign investment rather than a shifting regulatory environment.

Leading City firms have been advising investors from Asia Pacific on acquiring and securing planning permission for both commercial and residential developments, given the complex nature of English property law. As the second largest subdivision in the commercial property sector, by both value and investment, the office sector is providing a significant amount of work for firms. However, given the rapid expansion of the digital economy, firms are no longer just advising large corporate clients but also quickly expanding start-ups.

Mixed-use projects are also leading to an increased demand for legal counsel, with the trend of combining commercial and residential spaces within one development driven largely by a shortage of housing across London and the South East.

So while it’s incredibly hard to ascertain the long term implications of Brexit, real estate looks set to continue to feed demand for lawyers who specialise in property law.
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