Real estate presents ‘many opportunities’ as pandemic damages assets

A view of East London from an aerial view. As the sun sets, its glow is captured on the skyscrapers of Canary Wharf – London’s second business district.

Ray Wise | Moment | Getty Images

According to one of the top real estate investors in London, there are many opportunities for investors looking to grab ailing real estate in the aftermath of the coronavirus pandemic.

Thomas Balashev, founder and CEO of Montague Real Estate, said real estate has been unnecessarily hammered during the recession, giving buyers opportunities to turn a profit as the economy recovers.

“I think it goes without saying that there will be many opportunities,” Balashev told CNBC’s “Squawk Box Asia” on Tuesday.

A different kind of crisis

In contrast to the 2008 financial crisis, which was directly related to the U.S. housing market and allowed some people to “ get ahead, ” the current economic crisis took the market by surprise and hurt otherwise healthy assets, Balashev said.

“When you look at the way the pandemic has been dealt with, both politically and the devastating effect it has had economically, it has taken many people by surprise,” he said. “So assets that really shouldn’t have been sad, that shouldn’t have experienced such a significant fall in value, have suddenly hit the market.”

The global real estate market has been hit hard this year by the twofold setback of declining demand for commercial real estate, such as offices and retail space, and changing housing demand as homeowners switch cities for the suburbs.

Still, deals can be struck around the world, insisted Balashev, who recently joined a Luxembourg-based fund focused on acquiring ailing real estate assets in Europe, Asia and the UK.

If you are a liquid buyer and you have deep pockets, then there is a huge plethora of opportunities.

Thomas Balashev

CEO, Montague Real Estate

“If you are a liquid buyer and you have deep pockets, then there is a tremendous plethora of opportunities, not just on a fixed continent,” he said. “I think it’s a great time for real estate worldwide.”

Indeed, London-based Montague Real Estate, which deals primarily with non-market transactions in the prime and super prime real estate markets, has seen a resurgence in investor inquiries this year, Balashev said. That includes a 200% to 300% year-over-year increase in inquiries from investors in Asia interested in the UK

“We should take that as a positive sign that people in international markets still view London as a safe haven,” he said.


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