A few important facts around Brexit and the UK property investment industry:
- London remains Europe's largest asset management centre, about the same size as France, Germany and Switzerland combined.
- Nearly all the teams managing pan-European property funds are based in London. London-based managers who will need a post-Brexit Continental presence have set up operations in Luxembourg or Dublin, while keeping their management team in London with portfolio management delegated across the Channel. There are MoUs in place between the FCA and ESMA to allow delegation to continue in the event of no deal next January, but these could be superseded by any agreement reached between the EU and the UK Government between now and then.
- Many funds investing purely in the UK are managed by teams that include colleagues from Continental Europe.
This means that there are three things that it is crucial to preserve during Brexit negotiations:
- the ability to delegate portfolio management to London from entities based in the EU;
- the continued ability for capital to flow freely across the Channel;
- continued access to talent from across Europe under any new immigration regime.
Since the Brexit Referendum in June 2016, the IA has worked closely with the UK Government to ensure the worst effects of a possible no deal Brexit are mitigated. AREF and the IA continue to work together to ensure that the interests of property fund managers and their clients are strongly represented.
Author
