Global real estate transaction volumes for the fourth quarter of 2017 totaled US$228 billion, 10% higher relative to the same period in 2016 (Fig 1). This brings full-year volumes for 2017 to US$698 billion, 6% above the total transacted in 2016.

Click the table below to enlarge "Direct Commercial Real Estate Volumes Q4 -2016 -2017"

EMEA closed the year on a high note as full-year volumes jumped by 22% to US$300 billion, making it the most active global region. Asia Pacific followed suit with a 13% increase in activity, bringing the total for 2017 to a record high of US$149 billion. In the Americas, annual investment dipped by 12% to US$249 billion.

Foreign investors continue to favour London as the British capital led all cities in attracting crossborder investment in 2017. Capital from Hong Kong represented nearly 41% of all foreign inflows to London in 2017, up from 17% the year before.

Capping off what has been an exceptional year for the industrial sector, with volumes up 38% from 2016, the fourth quarter saw the closure of CIC’s US$14.3 billion acquisition of Logicor, a pan European portfolio of industrial assets.

U.S. multifamily investment maintained its momentum as volumes reached nearly US$41 billion in the fourth quarter. Annual activity fell to just shy of US$140 billion, about 8% lower than the record-breaking total seen in 2016, as the sector faces the potential for near-term supply risk with many urban submarkets continuing to digest elevated deliveries.

Global real estate markets continued their strong performance in 2017. While yields in many global markets are at record lows, healthy cash flow fundamentals have underpinned pricing. Though global markets remain liquid, the relative lack of product combined with continued
investor discipline are likely to limit further growth in investment in 2018. Given this, we expect global investment volumes in 2018 to soften by 5%-10%, to around US$650 billion.

Click here to download the JLL Global Capital Markets Research Q4 2017 Report

To discuss the report or its findings email Joseph Tsang, Managing Director and Head of Capital Markets at JLL Hong Kong.

Source: JLL

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