Intelligent Investment

Global Real Estate Capital Flows H2 2023

Global Cross-Regional Investment Volume Falls Significantly; Upturn Expected by H2 2024

March 28, 2024 10 Minute Read


Executive Summary

  • Cross-regional capital flows between North America, Europe and Asia-Pacific totaled US$26.3 billion in H2 2023, down by 45% from the already subdued levels of investment in H2 2022 and the lowest half-year total since 2011.
  • The high cost of capital, geopolitical concerns and uncertainty over monetary policy continued to hamper investment activity. North American capital, which historically makes up the bulk of cross-regional investment, was largely deployed domestically.
  • The industrial & logistics sector had the biggest share of cross-regional investment in H2, followed by the multifamily sector.
  • CBRE expects that many central banks will begin cutting interest rates later this year, which should lead to increased global investment activity. While cross-regional capital flows will likely remain below historical levels in H1 2024, they should begin to pick up in the second half of the year, especially for assets with attractive valuations in major markets.

Global Capital Overview

Global cross-regional capital flows fell by 45% year-over-year in H2 2023 to US$26.3 billion. North American investors, who generally make up the bulk of cross-regional investment, were less active abroad due to the high cost of capital amid more conservative lending standards. North American capital outflow fell to its lowest H2 total since 2012.

Industrial & logistics attracted the most cross-regional capital (US$8.3 billion) for the second consecutive half year. Multifamily also saw strong interest by historical standards with US$4.4 billion or approximately 18% of cross-regional flows targeting the sector in H2 2023—4 percentage points higher than the sector’s five-year average share. Hotels were the only asset type with a year-over-year increase in global investment due to lower pricing and a resurgence of global tourism.

Cross-regional investment in retail and office assets dropped to the lowest levels since the Global Financial Crisis of 2008 to 2010. As the office and retail sectors continue to undergo structural changes, it appears that further pricing adjustments are necessary before they can attract more investment. However, as market conditions begin to improve and interest rates fall, we expect investors will take advantage of more favorably priced opportunities.

Top Regional Inflow & Outflow

*H2 2023 percent change relative to the 5-year H2 2018-2022 average.
Note: All figures in US$.
Source: CBRE Research 2023, MSCI Real Assets.

Investment Trends by Region

North America

Cross-border capital to North America totaled US$6.1 billion in H2 2023, down by 14% from the same period in 2022. This was the smallest percentage decrease among the three major global regions, primarily due to faster price adjustments and market liquidity. Nevertheless, the strong U.S. dollar kept capital inflows to the region subdued on a historical basis.

New York City had five of the 10 largest cross-regional deals in H2, including Italian luxury retailer Prada’s purchase of 720 and 724 Fifth Ave. in Manhattan. Nearly half of all H2 cross-regional investment in the U.S. was for office assets, primarily by European investors. This was the office sector’s highest share of cross-regional investment since 2014, indicating foreign capital is taking advantage of pricing discounts in attractive markets.

Consistent with the findings of CBRE’s 2024 U.S. Investor Intentions Survey, Sun Belt markets also had some notable cross-regional deals. Meanwhile, Canada had its highest amount of H2 cross-regional investment since 2016.


At US$18.2 billion, Europe had its lowest H2 total of cross-regional capital inflows since 2012 due to persistently high inflation and interest rates. With yields at or near their peak for prime properties, we expect further stabilization this year will support increased cross-regional inflows.

While nearly all European markets had year-over-year declines in cross-regional inflows, the U.K. and Germany were the strongest performers on both a country and city level. This is in line with the finding of CBRE’s 2024 European Investor Intentions Survey that investors are looking for attractive price points in primary markets.

European logistics assets remained highly sought after by cross-border investors, while the hotel sector was the only one with a year-over-year increase in cross-regional investment volume in H2 due to more travel demand. Strong fundamentals should maintain positive investor sentiment for the hotel sector in 2024.


H2 cross-regional inflows to Asia-Pacific totaled US$1.9 billion, a 78% decrease from H2 2022 and the lowest half-year total since 2011. Limited yield expansion and high interest rates continued to result in a negative carry environment for commercial property, as well as a considerable difference in price expectations between buyers and sellers. As a result and in line with CBRE’s 2024 APAC Investor Intentions Survey, investors continued to take a wait-and-see approach. Investment is expected to remain limited in H1 2024.

Japan remained the leading Asia-Pacific country for cross-regional capital inflows in H2, primarily due to its low cost of debt. India had a sizeable increase in total investment, with opportunistic and value-add capital targeting the world’s fastest growing economy.

The logistics sector accounted for 82% of Asia-Pacific cross-regional inflow in H2. Despite some cap rate expansion, rent growth for logistics properties in the region has kept capital values relatively stable.

Cross-regional Inflows by Region

Source: CBRE Research 2023, MSCI Real Assets.

Cross-regional Outflows by Region

Source: CBRE Research 2023, MSCI Real Assets.

Cross-regional Inflows by Market

Source: CBRE Research 2023, MSCI Real Assets.

Cross-regional Outflows by Market

Source: CBRE Research 2023, MSCI Real Assets.

Investment Trends by Sector

Cross-regional Inflows by Sector

Source: CBRE Research 2023, MSCI Real Assets.
Note: APAC Multifamily data collection began in 2023.

Cross-regional Outflows by Sector

Source: CBRE Research 2023, MSCI Real Assets.

Sector Market Share Inflows

Source: CBRE Research 2023, MSCI Real Assets.

Sector Market Share Outflows

Source: CBRE Research 2023, MSCI Real Assets.

Looking Ahead

Despite the significant slowdown in cross-regional investment volume in H2 2023, the outlook for 2024 is more positive. CBRE believes that interest rates have peaked, with central banks in the U.S. and Europe expected to start cutting rates later this year. As interest rates fall and pricing stabilizes, we expect to see an uptick in cross-border investment activity during the second half of the year. However, in the near-term, U.S. and European investors will largely focus on their home markets and rely on their local expertise to secure discounts. CBRE also expects that Asia-Pacific investors will begin to look abroad for better opportunities.

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