UAE, Gulf Investors Shift From Luxury Properties Towards Income Generating Assets In UK, Says Report

(MENAFN- Khaleej Times) Wealthy Gulf investors are increasingly shifting their focus from luxury homes and prestigious properties towards income-generating assets, including property development, retail, affordable housing and commercial real estate, according to AlRayan Bank UK's latest GCC Investment Barometer 2026.

The fourth annual report found that property development has emerged as the leading priority for future UK real estate investment, attracting 30 per cent of respondents, followed by retail at 29 per cent.

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Social or affordable housing, hospitality and leisure, and personal residential property each attracted 28 per cent, while build-to-rent developments accounted for 24 per cent.

Student accommodation and industrial and logistics properties each attracted 23 per cent of respondents.

The findings suggest that Gulf investors are adopting a more diversified approach to UK property, placing greater emphasis on income generation, operational performance and long-term value rather than the prestige of individual assets.

UAE investors show growing confidence in UK property

The report found that 96 per cent of UAE respondents said their confidence in UK property had increased over the previous 12 months, the highest proportion among the three Gulf markets surveyed.

Meanwhile, 92 per cent of UAE respondents expect UK property to remain a strong investment opportunity over the next five years.

Among UAE investors considering London, 56 per cent cited the city's professional services as a key attraction, while 48 per cent pointed to long-term value appreciation and an equal proportion highlighted the option to live or relocate there.

Maisam Fazal, Chief Commercial Officer at AlRayan Bank UK, said investors in the UAE are increasingly assessing opportunities across international markets, with greater attention to asset quality, financing costs and long-term returns.

Property development attracts Saudi investors

Saudi investors showed particularly strong interest in property development, with 37 per cent identifying it as a future investment priority, compared with 28 per cent of UAE respondents and 24 per cent of Qatari respondents.

The report found that Saudi respondents plan to invest an average of £98.5 million in UK property over the next five years, up from £81.9 million in 2025.

Across all three markets, the average planned investment stood at £78.3 million.

Investors look beyond London's luxury addresses

Although London remains a leading destination for Gulf capital, investors are increasingly exploring opportunities in other UK cities.

Liverpool attracted interest from 34 per cent of respondents considering regional investment, followed by Birmingham at 27 per cent and Manchester at 25 per cent.

The report highlighted affordability, rental income, transport connectivity and local economic conditions as increasingly important factors in investment decisions.

AlRayan Bank said its clients are showing greater interest in mid-market assets and regional opportunities where tenant demand and income potential support long-term investment strategies.

99% plan further UK property investments

Despite changing preferences, appetite for British property remains strong.

The report found that 99 per cent of respondents intend to make new or increased UK property investments over the next five years, while 95 per cent expect the market to remain a strong investment opportunity.

However, geopolitical uncertainty is influencing investment decisions, with 51 per cent saying regional instability makes them more likely to invest in UK property, while 38 per cent are diversifying into other markets.

Investors prioritise long-term value

The research suggests that Gulf investors are increasingly evaluating properties based on their ability to generate sustainable income, rather than focusing solely on location or prestige.

Giles Cunningham, Chief Executive Officer of AlRayan Bank UK, said investors are becoming more selective as they compare British property with opportunities in other international markets.

The report surveyed 150 high-net-worth investors from the UAE, Saudi Arabia and Qatar, each holding at least £10 million in wealth or assets.

The research was conducted between June 4 and 12, 2026, and reflects investors' stated preferences and future intentions rather than completed investment transactions.

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