Coming out of lockdown: Global investment hot spots
As we finally emerge from lockdown, it’s time to consider where the best opportunities lie for investors. The uncertain environment of volatile equity markets, and $18tn worth of negative yielding bonds make the case for investment in real estate very persuasive.
2 minutes to read
Specifically, we predict triple growth in the industrial sector from private equity investors. Beyond this, the office sector has a significant role to play, with around 21% of global allocations. We expect capital to flow through intra-regional, near-neighbour investing, taking advantage of local expertise. We can also expect safe-havens to continue to be destinations for capital, regardless of travel disruptions.
In our recent Global Capital Markets webinar, we provided our view on where capital is flowing to and from this year, who will be active in what areas, and where we believe the best opportunities lie around the world in 2021.
Key takeaways include:
In Asia Pacific, the continued dominance of Singaporean capital in near-neighbour markets, together with continued strong US volumes and a resurgence of European capital will help fuel the region; outbound, Hong Kong REITs and Korean funds will dominate.
In the USA, international investor appetite will continue to grow given attractive pricing, lower hedging costs and a weaker dollar, with New York continuing to lead the path to recovery; outbound, perhaps not surprisingly, private equity will become increasingly prolific.
In Europe, in the true core, we are confident prime yields will harden, yet further German and French insurance capital will continue to be dynamic. This will be accompanied by far stronger volumes in the core-plus to value-add arena; outbound,
German capital will lead the way.
Globally, investor focus is on logistics and multifamily products, with a surge in interest for data centres and life sciences. Safe-haven and near-neighbour investing are common themes for all of us. Likewise, the fast-moving ESG agenda is now global with intercontinental investors rightly evangelising their sustainability expectations, whatever the jurisdiction.