Investors are continuing to favor commercial real estate citing improving fundamentals, low interest rates, and economic expansion. Great new opportunities are coming from international demand set at record levels last year. “Foreign investment in U.S. commercial real estate has been growing consistently over last six years, according to Deutsche Bank analyst Ashley Hooper. The volume of deals last year topped $49 billion, surpassing the 2007 peak investment level of $47 billion.”
Going forward, “In a new survey this week, CRBE found that investor demand for commercial property continues to increase, with 53% of global investors it surveyed indicated they plan to increase their purchases this year. New York, Seattle, and Dallas all made the top 10 list of markets where that money will be targeted.”
“The appetite for global real estate investment is increasing as more investors intend to deploy capital outside of their own region this year. Competition for assets is intensifying and many investors plan to move out the risk curve in search of higher yields, a trend that will result in a stronger focus on value-add and opportunistic investments,” said Chris Ludeman, global president of CBRE Capital Markets. He cited the current low interest rate environment, economic expansion across an increasing number of markets, and improving real estate fundamentals as the main reasons investors are continuing to favor commercial real estate.
Talk to us today about different opportunities and the yields, along with risk, involved when dealing with and deciding on a commercial real estate investment.
by DAN CAMPANELLA, Broker/Owner @ R.E.INVEST Brokerage, LLC. on May 9th, 2015.