Since 2009, international investments in commercial real estate increased fivefold, reaching $320 billion for the period June 2015 to June 2016, according to the annual global study of commercial property markets of the world Global Cities Reports 2017 international consulting company Knight Frank.
Negative interest rates, the volatility of currency markets and diversification of investment portfolios will contribute to the growth of inter-state commercial real estate investment in the short term.
Investors from Asian countries were the most active players in the international investment market in commercial property, investing in USA, Europe and middle East $67,1 billion (21% of the total $320 billion) during the period June 2015 to June 2016. More than half of Asian investment – $36.4 billion – had the objects of the United States.
The US has become the second most active player in the international investment market during the period June 2015 to June 2016, investing a total of $61,72 billion in commercial properties in other countries.
The largest volume of international investments has fallen on the countries of Europe – $78,8 billion, which accounted for 25% of the total. The highest activity in the investment market in commercial real estate in Europe showed American companies, investing a total of $51,1 billion.
The top 5 cities in the world in terms of total investment in commercial real estate during the period June 2015 to June 2016 included new York, Manhattan ($40.7 billion), London ($35.9 billion), Los Angeles ($33.1 billion), San Francisco ($25.8 billion), Paris ($23.7 billion). Among the cities of the world leaders in terms of attracted foreign investment in commercial real estate during the specified period were new York, Manhattan ($26.5 billion) and London ($25 billion).
The trend of the next years in the global investment market in commercial property – review of portfolios of real estate and increasing the share of infrastructure projects: toll roads and bridges, airports, Railways, power plants, telecommunication networks etc.
Another type of alternative investment that is gaining popularity today, is investment in rental housing. The growing population and globalization will keep demand for hotels, student hostels, clinics, nursing homes, which in turn stimulates the interest of big players in this segment of real estate.
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