More and more foreign investors are interested in multifamily in the USA!
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Commercial investment in the U.S. by foreign capital has risen sharply in a context where commercial real estate has broken records around the world.
These individual and professional investors investing from abroad focused primarily on the multifamily and industrial asset sectors in 2021. The total sales volume they represent was $71 billion last year, nearly double the 2020 level, to 8.5% of total U.S. sales (equivalent to the pre-pandemic level) according to Real Capital Analytics.
Globally, sales of commercial real estate assets reached $1.3 trillion last year, with the US, Asia Pacific and Europe all at record levels.
In the US in 2021, industrial and multifamily assets accounted for 34% and 30% respectively of total investment from abroad.
"We've never seen such levels of appreciation in the U.S. as we've seen in the last few quarters. Especially on industrial, multifamily, as well as very focused office assets, like in the healthcare industry. We're seeing a lot of investors shifting their allocations and moving their capital to different destinations to seek safety and performance," said Aaron Jodka, director of U.S. research at Colliers International.
The focus on these asset classes has pushed foreign investors to gain more exposure to U.S. secondary and tertiary markets, according to Real Capital Analytics. In fact, only 38% of capital went to the six largest metropolitan areas in the US. With a market like Manhattan relegated to third place in the ranking.
Source: Real Capital Analytics, GlobeSt
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