Commercial real estate continues to rank high on the list of acquisitions for investors around the world as preliminary global real estate investment volumes in the first quarter of 2013 reached US$94 billion, according to Jones Lang LaSalle capital markets research from 60 countries. The real estate investment volumes in Q1 2013 represented an eight percent increase over the same quarter in 2012.
Improving confidence in the global economic recovery and a continued demand for direct real estate exposure continue to push volumes higher with Germany, Japan, and the United States all finishing the quarter strong. Other highlights include:
· All regions show increases over a year ago with the Americas, Europe, Middle East and Africa (EMEA) and Asia Pacific (AP) all between seven and eight percent higher than one year ago. Growth in the Americas was driven by increases in the two largest markets of the United States and Canada (20 percent and 6 percent growth respectively).
• AP volumes driven higher by a 30 percent increase in Japan year on year and stronger investment volumes in Singapore and Hong Kong. Overall the region is eight percent up on 1Q 2012.
• Europe’s three biggest markets, the United Kingdom, France and Germany all contributed to the increase in transactional volumes, with Germany recording investment volumes almost 40 percent higher than a year ago. This helped drive the regional performance to be eight percent higher in US$ and six percent higher in Euro terms.
• With the improved results in 1Q, we maintain our forecast for the year to be between US$450-500 billion, with further growth in quarterly volumes as we move through the year.
Arthur de Haast, Head of the International Capital Group at Jones Lang LaSalle said, “Volumes of almost US$100 billion in the first quarter of the year, in what is historically a quieter period, demonstrates the desire investors continue to have for direct real estate investments. Encouraged by a slowly improving global economic environment and rising property values, especially in core cities, the number of assets for sale continues to increase.”
David Green-Morgan, Global Capital Markets Research Director said, “The improving sentiment across all real estate markets is encouraging buyers to look at opportunities slightly up the risk curve and vendors are cheered by an increasing number of buyers examining assets in more secondary locations. These two factors are helping to drive volumes higher and we expect this to continue for the remainder of 2013.”