NEW YORK — CBRE recently released the H1 2023 Global Real Estate Capital Flows report, which found global cross-regional investment volume declined sharply in H1 2023.
According to the report, cross-regional capital flows between North America, Europe and Asia-Pacific totaled US$30.5 billion in H1 2023, down by 52 per cent from H1 2022.
Elevated interest rates, softer real estate fundamentals and a mismatch in pricing expectations of buyers and sellers limited global investment.
The research also indicates:
- Cross-regional capital flow to Europe from the U.S. fell substantially in H1 2023, causing Europe’s total global cross-regional capital inflow to fall by 68 per cent from H1 2022.
- Cross-regional investment in North America increased by five per cent year-over-year, primarily driven by two large acquisitions by Asian investors.
- Industrial and logistics were the most sought-after assets globally due to their strong supply-and-demand dynamics. They accounted for 37 per cent of all global cross-regional investment in H1 2023, the highest half-year share of any asset type on record.
- CBRE expects cross-regional investment volumes to remain subdued for the rest of 2023 before recovering in 2024.
“Global investors likely will remain cautious for the rest of this year due to high interest rates and economic uncertainty,” said Richard Barkham, Global Chief Economist for CBRE, in a statement.
“Nevertheless, it appears that inflation has peaked globally and central banks are either at or near the end of their rate-hiking cycles. Therefore, we expect the global investment market to begin recovering in the first half of 2024.”
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