Global commercial real estate investment volumes surge to just under USD 90 billion in Q1 2011

Global cross border investment volumes increase by 38% in Q1 2011, compared to Q1 2010 according to latest data from Jones Lang LaSalle

London, Chicago, Singapore, 3rd May 2011 – Preliminary figures released today by Jones Lang LaSalle’s Capital Markets Research reveals that global direct commercial real estate investment volumes totalled just under US$90 billion in the first quarter of 2011. This figure is down 20% from the previous quarter but up nearly 38% from Q1 2010, indicating the continued appeal of commercial property to a broad range of investors.
Arthur de Haast, Head of the International Capital Group at Jones Lang LaSalle said: “We continue to see strong interest for core product in gateway cities from institutional and private investors. However, investors are only moving into riskier markets and products on a selective basis, with many waiting to see more bank-released product or stronger fundamentals first.”

In Asia-Pacific, volumes rose both compared to the previous quarter and to the same period in 2010. “This continued growth is testament to the strong fundamentals of the region. Japan was the most active real estate market, with a confident start to the year, albeit prior to the recent earthquake tragedy. Domestic investors dominated activity in the region’s other major core markets”, noted Stuart Crow, Head of Asia-Pacific Capital Markets at Jones Lang LaSalle.

In Europe and the Middle East, activity slowed compared to the last three months of 2010, but was up nearly a quarter year-on-year. Richard Bloxam, director of Jones Lang LaSalle’s EMEA Capital Markets commented: “The seasonal slowdown after the end of year rush was expected, particularly after a closing quarter with a number of large, high profile transactions. However, compared to the start of 2010 all major markets have seen an increase in volumes, particularly Germany, Poland, Russia and the UK.”
In the Americas, the volume of activity also dropped off modestly compared the previous quarter but more than doubled from Q1 2010. Commenting on these results, Steve Collins, Managing Director, Americas at Jones Lang LaSalle, said “We saw a big jump in volumes at the tail end of last year, driven by the US, and we expect a strong year in 2011. The small drop off in Q1 is the result of investors adopting a ‘wait and see’ approach, due to concern they might be chasing yield downward.”

In Hungary, volumes rose significantly compared to the previous quarter and to the same period in 2010. “Some €233 million were traded in the first quarter which represents  around 12% of the CEE volume . The activity remained centred on Warsaw and Prague but more than 35% of the regional activity took place outside of Poland and the Czech Republic. While Hungary remains a  challenging sale, we see a clear improvement in the perception by investors of the risk profile and potential of the country  and we are expecting a sharp investment recovery in 2011” added Benjamin Perez-Ellischewitz, Jones Lang LaSalle’s Head of Capital Markets in Hungary and Croatia.