51
UNITED STATES INVESTORS: PRIMARY INVESTMENT FOCUS (NEXT 12 MONTHS)
INDUSTRIAL AND LOGISTICS 71 SHOPPING CENTERS 40
% DEVELOPMENTS 31 OPPORTUNISTIC 23 HIGH STREET RETAIL 17 HOTEL 11
OFFICE CBD 49 US INVESTORS IN EXPANSION MODE
More than three-quarters of US investors surveyed expect to expand or increase the level of investment in their property portfolios during the next 12 months. None expect to reduce their portfolios. Almost the totality of US investors (98%) will invest in North America in the next 12 months, with 27% also looking to invest in Asia and EMEA.
The survey suggests that 47% of US investors will source 100% of their capital in the domestic market, with 13% sourcing 100% of their capital outside North America.
CROSS BORDER INVESTMENT GAINS MARKET SHARES
Although overall transaction volume in the US remains well below the 2007 peak, volume from cross-border sources for the first three quarters of 2014 has surpassed the same period in 2007. It now comprises 9.5% of the total compared with 8.5% in 2004 and is the only capital source to gain market share this year, according to RCA. Canada remains the largest source of foreign capital, with about $8.2 billion invested in the US year-to-date in
2014, followed by China at US$4.6 billion and Norway (US$4.0 billion), whose sovereign wealth fund has aggressively been targeting properties in gateway cities such as New York and Boston. Asia continues to account for a large share of foreign capital inflows, with Japan (US$3.2 billion), Hong Kong (US$1.9 billion) and Singapore (US$1.7 billion) ranking among the top eight foreign capital sources in US real estate year-to-date 2014. When the survey asked investors from outside North America about investing in the region, a third of Asian investors expressed their intention to do so in the next 12 months, more than for any other region, and the second largest group behind Latin American investors (57%). Around 31% of EMEA based investors (ex. UK) are also looking to invest in North America over the same period, with 26% looking specifically at the US.
Increasingly, foreign investment is no longer focused solely on gateway markets as was the case earlier in the cycle. Improvements in secondary and tertiary market fundamentals, coupled with higher yields, are also attracting greater foreign interest.
RESIDENTIAL 37
OFFICE SUBURBAN 23
DEBT 20
LAND 11
LEASEHOLDS 6
2015 GLOBAL INVESTMENT SENTIMENT REPORT
COLLIERS INTERNATIONAL
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