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Strong Q3 points to stability in global real estate investment

Global MarketFlash | 9 November 2017

At $228 billion, the global value of commercial real estate investment transactions increased by 2.2% in Q3 2017 compared to Q3 2016 (see Figure 1).1 Both the EMEA and APAC markets maintained high levels of investment activity, with growth of 21.6% and 21.0%, respectively, for the same period. The Americas showed a 10.8% drop in Q3 over Q3 2016.

MarketFlash Infographic

The principal reason for the 21.6% increase in EMEA was a stronger U.K. market, which saw an upsurge of 57.8% in investment activity. Excluding the U.K., the rest of the EMEA region showed solid growth of 11.7% on last year’s third quarter. While larger markets such as France or Germany saw a slight decline in transaction volumes, a number of markets across Europe increased, with the Netherlands, Finland and Spain all showing substantially higher activity.

APAC also saw good growth, up 21.0% in Q3 2017 on the same period last year. Asian markets were the primary drivers of activity, experiencing 38% growth this quarter on Q3 2016, largely due to a 94% uptick in activity in China. Other strong performances in the region included India and Singapore, which in the first three quarters have both already surpassed their total investment transactions for 2016. The Pacific markets didn’t fare so well; in particular, Australia saw a drop of 33.9% this quarter on Q3 2016.

The 10.8% drop in investment activity in the Americas for Q3 2017 on Q3 2016 was a region-wide trend. One bright spot in the region was Brazil, where a large number of high-value deals led to an exceptional quarter.

 

MarketFlash Chart

1. All comments (and quoted changes) relate to the trends as measured in fixed U.S. dollar exchange rates unless otherwise stated.

2. For the calculation of fixed exchange rate totals, all local currency values are converted to USD using the average daily FX spot rate in Q3 2017.

For more information, please contact:

Richard Barkham, Ph.D.
Chief Economist, Global
+617 912 5215