REAL ESTATE - Institutional investors were net sellers of global real estate in 2005, according to Jones Lang Lasalle.
"Inter-regional purchase activity in 2005 was overwhelmingly dominated by unlisted and listed funds and institutions," the firm said. "Unlisted funds were the largest inter-regional purchasers in 2005 - increasing their purchases by 73% over 2004 levels.
"Increasing their share of inter-regional purchase activity by 55%, institutions were significantly more active in 2005, however were overall net sellers."
Jones Lang Lasalle said global direct commercial real estate investment in 2005 rose 21% to $475bn (€383bn) over the 2004 figure.
North America remained the largest investment destination (nearly half of total transaction volumes) whilst Asia Pacific deal volume was up 56%.
Cross-border investment as a proportion of total investment grew to 35% in 2005 to $164bn.
Inter-regional volumes rocketed rose by 40% and now account for almost a quarter of total global transaction volumes.
"As allocations to international real-estate grow, opportunistic capital is increasingly targeting the shores of recovering and emerging markets," said Tony Horrell, chief executive of JLL's international capital group.
"Germany's economic recovery and real estate market re-emergence continued in 2005; we saw inter-regional investors make $10.8bn of purchases and $6.1bn of sales.
Horrell concluded: "We expect capital flowing into real estate to continue to outweigh suitable opportunities as real-estate remains an attractive asset class, relative to equities and bonds.
"Key themes we predict going forward include a competitive and structured debt market driving weight of capital and the globalisation of REIT markets and pooled asset vehicles, both of which will accelerate the globalisation of direct real estate investment."
