Global cross-border investment rose by 60% year-on-year in 2010, according to research from Jones Lang LaSalle.
Cross-border investment accounted for 40%, or $130bn, of all direct commercial real estate investments last year. JLL said this proportion was equal to the boom years of 2006-07.
Arthur de Haast, head of JLL’s international capital group, said: “During the downturn, domestic trading held up better globally than cross-border activity as investors focused their attention on familiar markets.
“In 2010, however, equity-rich investors led the flight to quality assets in core, mature and transparent markets, supporting the resurgence in cross-border investment volumes over riskier secondary and tertiary domestic markets.
“We expect domestic and cross-border transaction growth to continue in 2011 as investors move up the risk curve.”
In Europe and the Middle East last year, 53% of all deals were cross-border transactions, while 47% were domestic transactions.
JLL said cross-border volumes in Europe and the Middle East reached $72bn of a total market of $136bn, which was a 53% increase on 2009 when cross-border deals accounted for $47bn of $97bn total European and Middle Eastern volumes.
Richard Bloxam, director of Jones Lang LaSalle’s EMEA capital markets group, said: “With two of the most sought-after global markets in the region, namely London and Paris, and a large number of active global investors, it is no surprise that this region led the world once again in terms of cross-border activity. We expect this trend to continue.”
The UK was the second-largest market in terms of volumes traded, accounting for $49bn, following the US, which reached $80bn.
nathan.cross@estatesgazette.com
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