A significant increase in cross-border investment over the past year, particularly from Asia and North America, is driving growth in the European commercial real estate market, Jonathan Hull, head of CBRE capital markets EMEA, told PropertyEU at Expo Real.
A significant increase in cross-border investment over the past year, particularly from Asia and North America, is driving growth in the European commercial real estate market, Jonathan Hull, head of CBRE capital markets EMEA, told PropertyEU at Expo Real.
‘We’re not seeing a wall of capital but there is a lot more capital coming into Europe and it’s a more diverse base than we’ve had for a long time. I think the big change is that confidence seems to be returning to the market and we’re seeing that generally across markets in Europe. The exciting thing is that this capital is looking at a wider base of markets, in particular cities outside London are now key targets.’
The proportion of cross-border investment coming from outside Europe has increased significantly in recent years, reaching over 22% in the first half of 2013 compared with 18% in 2007.
North American investors accounted for the bulk of the ex-European capital targeting the European market at €18.9 bn while Asian investors accounted for €7.8 bn, research from CBRE shows. Cross-regional capital (coming into the European market from other parts of the world) and intra-regional capital (cross-border investment but from inside Europe) are roughly equal in terms of total value of transactions executed, with each accounting for just over 20% of total buying activity in Europe recently.
However, these two different tyupes of cross-border investor tend to invest in very different types of property and, to an extent, in different locations.
