So much for London's status as a haven for foreign investors.
Wealthy individuals and sovereign wealth funds that have poured money into London's commercial property market in the past 18 months could be forgiven for pangs of regret as images of rioting and looted properties in the capital spread around the world.
But London's property community remains stoical, believing that the social unrest is a short-term deterrent that does not detract from the city's attractiveness to overseas funds.
"In the short term this adversely impacts on sentiment. However, I firmly believe over the long term London prospects remain robust," says Adrian Wyatt, the chief executive of the developer Quintain.
Frankly, overseas investors are interested only in Knightsbridge, London's West End and sometimes the City. Once they have assured themselves that their assets are safe, they will continue to search for worthwhile investments in the best locations the capital can offer.
As if to underline that it is business as usual, Qatari Diar and its British property company partner Delancey were last week selected by the Olympic Delivery Authority to buy and redevelop the Olympic Village, after next year's games in a £557 million (Dh3.33 billion) deal.
The City, 11km south of Tottenham, the suburb in which the riots began, is buzzing with construction workers again, following a hiatus in the wake of the collapse of Lehman Brothers in the US and the onset of the global financial downturn.
Last month, work resumed on the tallest tower in the financial district, after its owners moved to plug an expected shortage of office supply. The 64-storey Pinnacle, nicknamed the Helter-Skelter, was built only to ground level while its owners, mainly Saudi and Kuwaiti investors, agreed financing.
Irvine Sellar, the developer behind the Shard, western Europe's largest tower that now dominates London's skyline, has also pressed the button on a second tower building, just south of the City financial district, across the Thames.
The Shard is a beneficiary of the influx of Middle Eastern money, being majority owned by the Qatar National Bank.
"It has become clear that more traditional West End occupiers are having to look at alternative locations as there simply isn't the space to satisfy demand. At the same time many of the proposed City towers will not be available for letting until 2014 at the earliest," Mr Sellar says in explanation of the decision to push ahead with a second project, without a tenant.
Land Securities, one of Britain's biggest property companies, took the speculative development plunge a while back. It began work on 20 Fenchurch Street, dubbed the Walkie-Talkie tower, in May last year.
"London remains an attractive place to do business and so London remains an attractive place to invest," says Francis Salway, the chief executive of Land Securities.
"We were the first to restart developments in London as we saw a supply constrained market emerging as there were a higher than normal level of lease expiries due from 2013, particularly in the City market."
Mr Salway is pleased to have a head start on rivals because he now believes the supply constraints will prove even more acute than the company first thought. "The lack of development finance means the development tap has not been fully turned on," he says.
While Land Securities and British Land, another major property company, do have funding to begin development work, other domestic companies and investors have found themselves beaten time and again by foreign investors willing to pay eye-wateringly high prices for assets.
The property agency CB Richard Ellis recorded 53 separate transactions by non-domestic investors, totalling more than £6bn in the West End and the City last year. Fourteen deals above £50m have been recorded so far this year by agents Jones Lang LaSalle, which believes there is more than £52bn of overseas equity destined for London this year.
Chris Northam, the director of City investment at Jones Lang LaSalle, has seen some notable trends in the diversity of investors. "There has been real growth in interest from Far Eastern investors: Malaysians, Indonesians and Chinese have all done deals in recent months."
Canadian investors have also been active. Oxford Properties, an Ontario Municipal fund, now owns or part-owns several high-profile assets in the City, including Watermark Place, the London HQ of Nomura. Oxford also has a half share, with British Land, in the so-called Cheesegrater tower in the City.
"We have also seen the return of the Japanese," says Mr Northam, with three acquisitions in the past six months. But he adds that while property values have surpassed the 2007 peak in the West End and are almost at that point in the City, all is not rosy.
"The biggest hindrance to the market going forward is the lack of stock available. There is little out there, which is why strong rental growth of 20 per cent is expected in the City in the next two years," he says. "If anything the market will be slightly subdued this year, because of this."
So why is London attractive to overseas investors?
First and foremost it is deemed a haven, says Bryan Pickup, the international head of property at the law firm SJ Berwin. Not only is property a tangible purchase, the UK is recognised as having a justice system that protects investors and is above politics, unlike in some other jurisdictions. For instance, flats in a new residential development next door to London's Tate Modern art gallery have been almost entirely snapped up by Chinese buyers, desperate to get their money out of China.
Sterling is also a great advantage at the moment. Not only is the currency outside the troubled euro zone, but many investors believe it is undervalued.
Still, investor profiles have certainly changed in the past three years. Spanish and Irish investors were big buyers and owners of property in 2006 and 2007 but, since the recession, they have largely disappeared.
Russian money is still around, but it is more discreetly placed than previously, says Mr Pickup.
These equity-rich buyers, whose wealth seems to know no end, have really stamped their mark on the City, and, to an even greater extent, the West End.
And their investment style is unconventional. One agent says: "All that matters to them is buying a prime asset. Some don't even bother with a valuation - they aren't that interested in the income, all they want is a good address where the capital value will increase over time."
Riots and financial turmoil may come and go, but the long-term attraction of London's best addresses remains real.
business@thenational.ae
