India To Become Biggest Investment Market For London: UK Realty Major Barratt London

India will become the biggest investment market for London’s real estate sector, UK’s top realty developer Barratt London says as it launches its newest project, ‘Sterling Place’ in India.

Barratt International’s sales and marketing director, Stuart Leslie, who is in India for the project’s launch, met several investors during the week who have shown keen interest in investing in the project.

The Sterling Place project is located in New Malden, a leafy part of London and close to areas like Wimbledon, Kingston Upon Thames and Richmond Park. The project also offers a quick journey out to Surrey/Central London.

The apartments will be positioned in seven staggered-height blocks ranging from seven to fourteen storeys. Barratt says that the first phase will offer panoramic views over southwest London and towards the city.

“This is the first international launch which has happened in India. We didn’t launch it in Hong Kong or Singapore but chose India. We met many buyers who reserved on the first day, but most of the people who will take a decision have friends and family in London through which they already have a connection with the city,” says Leslie. 

He adds that most Indian buyers will be investing for the first time, but they are seeing a phenomenal response from relatives and friends of people who have bought properties from Barratt in the past.

The 428-apartment project will be built over land worth 10 million pounds, but Leslie sees the GDV of the project as much greater. The realty developer is pegging the posh locality and affordability as the unique selling point.

For a one-bedroom home, prices for Sterling Place in New Malden will start from £379,000 (~Rs 4 crore).

The potential buyers in India

“We’ve seen that Indian buyers’ habits have changed post-Covid with the need for a good work-life balance being more important than ever before. In an area like New Malden, you’re right at Surrey’s gateway, where you have that perfect blend of both the countryside on the doorstep and the buzz of the capital less than a 30-minute train journey away,” says Leslie.

The demand for property in the UK’s capital is picking up among Indian investors, and Indians are amongst the biggest property buyers, per Barratt’s projections on the back of a strong influx of Indian students coming for education, rising interest in buying a second home and Indians wanting to diversify their portfolio.

The UK is enduringly popular with international students, and this year, the number of overseas students hoping to begin studying at British universities is up 2.4 per cent from the previous year, with 138,050 new applications from young people all over the world, per the Universities and Colleges Admissions Service (UCAS). Stuart Leslie, Sales & Marketing Director, Barratt International 

There has been a significant rise in applications from UAE (16 per cent), Pakistan (15 per cent), India (9 per cent), and, with a 6 per cent increase, both Malaysia and Singapore. The students often struggle to find good accommodation while studying, so parents now prefer to buy homes for their children’s education.

Leslie says that traditionally, Barratt London was targeting high net-worth individuals, but now they are also seeing a middle class that is looking to invest in London as their first overseas investment.

London as an investment destination

Besides the project’s location and affordability, Barratt London is also pegging the project to give multifold capital appreciation and strong rental yield growth.

“If you are looking to have capital appreciation together with a rental yield and you can buy a property within a certain price range, then there is no better place than London,” says Anita Mehra, Managing Director, Benham & Reeves.

Benham & Reeves is among London’s oldest, independently-owned property lettings and sales agents, specialising in residential sales in prime areas of London. In August this year, Barratt London partnered with Benham & Reeves India to cash in on the growing demand of property buyers from India looking for opportunities across the UK. 

Leslie cites Hendon Waterside as an example of Barratt London‘s past project, which has given exceptional returns in the last ten years. 

“The average prices in London increased by 54 per cent between 2011-20. However, within the same period, this project went up by 130 per cent,” says Leslie, highlighting the appreciation due to regeneration where the realty major claims its expertise.

“We are looking for locations that are not already established or that have a growth potential,” adds Leslie.

Focus on regeneration

On being asked about the focus of Barratt London on regeneration projects, Leslie says it was a thoughtful business decision based on the demand dynamics.

“Brownfield regeneration sites are built three times faster compared to traditional projects. We also have the opportunity to create more biodiversity and bring more rural London into the urban setting,” he says.

He adds that the luxury market in London is very limited. 

“It makes sense for us to go after the sector with more customers and deliver a good value for money. We have a social responsibility under the governmental target of delivering housing for Londoners,” he says.

Timely delivery

Barratt Developments  has built over 650,000 properties and delivers nearly 17,000 properties yearly. Of this, Barratt London delivers around 1,500 homes per year and is confident about the on-time deliverability of its products.

“We are a listed company. It’s imperative that when we forecast our figures, we deliver what we forecast to support our shareholders and share price,” says Leslie.

On protecting the initial deposits of the investors, Leslie says that they are not only protected by our balance sheet but also covered by the National House Building Council (NHBC).

“The financials of the company are huge. We have over a billion pounds of cash, though, that is, of course, being used for land acquisition. The deposits are also covered by NHBC,” says Leslie.