Japan Major Report – Rising Outbound Flows: Japanese Capital in the Global Real Estate Market October 2015
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Overseas real estate investment by Japanese buyers has been expanding since 2011. While the amount decreased y-o-y by 6.9% in 2014 to USD 1.8 billion, the growing trend in recent years is likely to continue.
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The favoured regions for investment are North America and Europe. However, in terms of investment for development purposes, Asia has been the major target destination.
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Major force behind overseas real estate investment has been the real estate companies and general trading companies.
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Overseas real estate investment by Japanese buyers should continue to increase and in particular, investment by The Government Pension Investment Fund (GPIF) is likely to be one of the key drivers.
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Assuming that it will invest a similar proportion of its assets in real estate as other Japanese public pension funds, and in overseas real estate as one of the major US pension funds, we estimate that the total amount of investment in overseas real estate by GPIF could potentially be at par with the total Japanese outbound real estate investment recorded in 2014.