London best city for foreign investors
For the first time since 2009, London has been named as the best city for foreign property investors in a survey conducted by the Association of Foreign Investors in Real Estate (AFIRE).
AFIRE member firms have an estimated US$2 trillion or more in real estate assets under management globally. The survey was conducted in the fourth quarter of 2013 by the James A. Graaskamp Center for Real Estate, Wisconsin School of Business.
“Foreign investors’ continued and growing interest in the U.S. real estate markets reflects fully functioning capital markets for both debt and equity that provide access to a broad range of investment opportunities,” said Steven Hason, Managing Director and Co-Head of Americas Real Estate for APG Asset Management US Inc. and the newly elected Chairman of AFIRE.
“Within the U.S, investors can participate in investments ranging from predictable core investments in gateway markets to potentially higher-yielding investments in secondary markets. And, in today’s markets, the survey reinforces AFIRE members’ beliefs that the U.S. provides an advantage for both safety and stability.”
Spain was named the second best country for capital appreciation, receiving 21.1 percent of the votes, almost half of what the first-place U.S. attained. Last year, Spain was barely mentioned, a distant fifth.
Madrid and Munich appeared among the top ten global cities, eclipsing Washington D.C. While the U.S. remains the primary target for foreign investment, 69 percent of survey respondents projected they would also have modest to major net increases in their European portfolio.
After China, in first place and moving up a notch from last year, the next four emerging countries were in Latin America. Brazil fell from first place into second and Mexico advanced into the third slot followed by Colombia and Peru. Mexico has appeared on the emerging market list since 2009, but always in fourth or fifth place. Last year Colombia and Peru were tied for seventh place.
Some 44 percent of survey respondents also project a modest increase in their investments into Latin America while 19 percent project a major increase. 31 percent say they intend to maintain or reinvest their allocations.