According to research from BNP Paribas Real Estate, buyers from overseas were involved in three-quarters of the commercial transactions of £5.
5 billion in central London during the past six months, investing heavily in office and retail property markets in the nation's capital.
Once the primary investment for domestic and United States institutions, central London has drawn greater interest over the past two years from ambitious sovereign wealth and pension funds, particularly from the Singapore, Korea and Malaysia, which have been backed by their respective governments' institutions.
Richard Garside, a director for BNP Paribas in London, added that the new de-regulated economies, such as China, were the primary sources of funds investing the residential and commercial property markets in London, attracted to the city by the mature nature of the property market and the high quality of investment stock.
There have been several high-value, high-profile deals in central London so far this year.
Earlier in the year, the Kuwait government spent £385 million to acquire the European headquarters of Bank of America in Canary Wharf and Kumpulan Wang Persaraan, a Malaysian pension fund, was involved in purchasing a city block office for £215 million.
The most recent purchase was that of the Lord Rogers-designed Lloyd's building by the Chinese life assurer, Ping An, for the amount of £260 million.
Overall, investors from Asia have rapidly increased their spending in London, with an increase during the past three months of 166 per cent over the first three months of the year, which accounted for investments of £1.
04 billion over that period of time.
There are several factors contributing to the increased interest of foreign investors in the property market of London, which last year had more international property investors than any other country in Europe.
One is that large, cash-rich investors have been pressured to diversify away from the bond markets in addition to low interest rates and equity markets which have been very volatile.
Another is that the office market in central London has been offering investors a government bond-like risk profile but the interest rates have been much better with yields between four and six per cent.
These investments made by foreigners have helped to create a boom in development in London and increased hopes for increased office values.
The rest of the United Kingdom has not seen the same interest from foreign investors as in London, making it somewhat out of place from the rest of the country.
Recent figures released by the Health and Safety Executive show that although London is home to only one in eight people in the United Kingdom, there is more construction going on in the city than throughout the rest of the country combined.