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Singapore investors spent US$4.4 billion (S$6.18 billion) on commercial real estate outside of Asia in 1H 2015, making them the second biggest source of outbound capital within the region, according to the latest report from CBRE.
But the top spot was retained by China, which invested US$6.6 billion (S$9.27 billion) in global commercial properties, while Hong Kong clinched 3rd place with US$2.2 billion (S$3.09 billion).
Overall, outbound commercial property investments from Asia rose by 8.9 percent to US$10 billion (S$ 14.04 billion) in Q2 2015 on a quarterly basis, pushing the total for 1H 2015 to US$19 billion (S$26.68 billion).
On an annual basis, investment volume from the region increased by 13 percent in the first of the year. But intra-regional commercial property investments slumped by 40 percent due to lower liquidity and limited product availability.
The US has overtaken the United Kingdom in terms of the most preferred investment destination by Asians, receiving US$6.1 billion (S$8.56 billion) compared to US$4.4 billion (S$6.18 billion) for the latter.
In fact, US inflows for the period already reached 90 percent of last year’s total, said Marc Giuffrida, Executive Director of CBRE Global Capital Markets.
While the transactions that made headlines were mainly located in New York, about 40 percent of the capital went to Boston, Seattle, Los Angeles and Washington — all markets with very positive fundamentals and availability, he noted.
Meanwhile, London continues to be the most favoured city of Asian investors after it raked in US$3.8 billion (S$5.34 billion) during 1H 2015. It’s trailed by New York with US$3.7 billion (S$5.19 billion) and Sydney at US$2.2 billion (S$3.09 billion).
“London still maintained its position as the world’s leading city. It received around 85 percent of UK inflows so far this year, and we are now seeing investors taking advantage of positive sentiment in the leasing and capital markets by looking at value enhancement strategies and development,” added Giuffrida.
Notably, the figures only comprise commercial real estate transactions above US$10 million (S$14.04 million). It excludes development sites, entity-level acquisitions and residential purchases for self-usage.
Image: New York City skyline.
Nikki De Guzman, Editor at CommercialGuru, edited this story. To contact her about this or other stories email nikki@propertyguru.com.sg
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