Uae investment in global property tops $4.5 billion
Investment from the UAE in property across the globe has topped $4.5 billion.
China has long been the big spender in real estate, but money from the Middle East is becoming a significant force in the worldwide property market.
New figures from CBRE show "a continuing acceleration" in the flow of capital out of Middle East region by private offices and HNWIs, with $4.54 billion spent on properties by HWIs and private investors in the UAE.
"This, to some extent, is compensating for a decline in sovereign wealth capital going overseas, naturally perhaps as a consequence of reduced revenue allocations because of recent oil re-pricing," says Nick Maclean, Managing Director of CBRE Middle East. "The interest in overseas investments, particularly from the UAE, is also being influenced by some uncertainties in local real estate markets."
"Despite low oil prices, Middle Eastern purchasers remain very active, collectively investing $11.5 billion outside their home markets in first half 2015. Almost $5.24 billion and $4.54 billion flowed out of Qatar and UAE respectively into direct real estate globally during the period," adds the report.
Global commercial real estate investment reached US$407 billion in H1 2015, the strongest first half to a year since 2007 and up 14 per cent year-over-year.
Where is the money being spent? The US, UK and Germany remain, by far, the largest CRE investment markets globally, with a combined total of $301 billion spent in the first six months of the year, almost two-thirds (74 per cent) of the overall market. Indeed, the strength of the USA's economy, as well as the UK's, has influenced investment trends around the world.
While the Americas saw growth rise 31 per cent year-on-year, the strong US dollar impacted activity in the EMEA and Asia Pacific regions. In dollar terms, EMEA was up just 5 per cent and Asia Pacific was down 19 per cent year-on-year.
Looking ahead, CBRE warns that global investment volumes may not increase at the rates they have done over the last several years, but "will continue to grow" in H2 2015 and 2016, as property continues to offer a spread over bond rates across world real estate markets.