According to JLL’s Q1 Investment Outlook, New York and Los Angeles rank as the number one and two markets for global office investment activity for the first time in 10 years – but now, international buyers are facing more aggressive pricing and financing fundamentals that might make new opportunities in these gateway markets look more challenging.
In 2015, Canada and China accounted for 40.9 percent of total U.S. office real estate acquisitions, but in 2016’s first quarter, Germany took the lead at 37 percent.
According to Steve Collins, JLL’s Head of Capital Advisors, many German and British investors and the main sovereign funds have local offices in the primary markets and are exploring secondary markets, while smaller funds and Chinese investors are creating relationships and partnering with local firms.
International money has no doubt settled into the U.S. office market, but what will investors do as fundamentals continue to strengthen in traditional gateway cities? The early indicators support that investors will widen their geographic targets… cities with strong millennial demographics and tech strengths are particularly resonating with foreign investors – think locations such as Seattle, Portland, Dallas, Austin and Denver.
Read more in National Real Estate Investor by Robert Carr
Head of Capital Advisors, JLL Americas