German funds may have stepped back from some deals of late but they are not going to stop buying in London, or elsewhere, any time soon, according to experts.

With cash of more than €20bn (£15.5bn) on hand – fruits of the real estate focus of Germany’s legions of retail savers – these openended property funds are some of the most equity-rich in a market where leverage has all but disappeared.

Peter Schreppel, head of international investment at CB Richard Ellis, a commercial real estate advisor, in Frankfurt, says: 'Funds have pulled back from a couple of deals but this is not a question of not being able to finance the deals. They have put their foot on the brake a little, having had it hard on the accelerator in the past months.

'We still believe these funds are out to buy longterm. They are some of the few buyers out there with enough fire-power.' About €860m was invested by the German retail funds in the UK in the first half of this year. France has also been a favoured market.

Financial Times