European investors back in the US market in force
- Posted by admin
European investors are returning to the U.S. market after a period of inactivity caused by the health crisis, according to Jeremy Katz, head of the firm CP Capital. Investments from Europe, which were abruptly halted in 2020 following travel restrictions put in place during the pandemic, are officially back, with a strong resurgence of interest.
"Demand had never gone away, but these investors were not able to execute their plans. Now they can catch up and adjust their capital allocations to the new global environment."
In addition to the pandemic, the war in Ukraine has caused many European investors to move to the US market. "The conflict in Ukraine is being felt much more in Europe, and investors are increasingly looking for safety in the U.S. market," Katz says. "Investors are redirecting their capital to the US as the conflict escalates to deal with the potential risk of expansion."
While recent events have attracted European buyers and investors across the Atlantic, Katz explains that European capital has always targeted the U.S., thanks in part to favorable demographic trends.
"When we compare demographic changes in the US and Europe, we see that in the US we have quite strong population growth compared to Europe which is declining. Investors are far from insensitive to this factor that has persisted for 30 years."
However, the pandemic has created significant demographic trends in the U.S., with many households moving to new areas, particularly the Sun Belt (southern region of the U.S., including Florida). "If we look at the data from the 80s and 90s, we can see that many Europeans only wanted to be in New York, Boston, Los Angeles, San Francisco, and Washington, but that has changed over time. European investors have taken note of the demographic trends toward the Sun Belt, which has fueled demand for acquisitions and multifamily developments in these markets.
Source: GlobeSt, CP Capital
0 Comments