Total investment volume

Total investment in the global real estate market: overview

The global commercial real estate market remains one of the most popular. For the last year the total volume of investments in it has made 996 billion dollars. The segment of apartments was the most popular.
Among the total amount of investments in the commercial real estate market, 333 billion dollars belongs to individuals. This figure is 5% higher than in the previous period. The share of institutional investors is 461 billion dollars, while the share of end users is 38 billion dollars.
According to the reports of market analysts, the most popular are apartments – $122 billion have been invested in this segment, which is 36% of the total market. The offices account for 25% or $85 billion. Investments in retail and warehouse premises are 13% each.
According to experts, soon apartments and office buildings will begin to lose their popularity, although now they are the leaders of the segment. They are being replaced by sectors that were considered alternative until recently. These include hotel complexes, nursing homes and various health care facilities. Investments here have been about $37 billion. Projections say that a similar trend will be observed in the current and future years.
The US market remains one of the most promising. It has managed to attract the maximum amount of funds – $224 billion. Moreover, both local businessmen and foreign investors are equally active here. The second place is occupied by real estate in Germany with the figure of $15.9 billion. The top three leaders are closed by Great Britain, where the volume of investments is $10.3 billion.
The Russian real estate market is also gaining momentum. It has received financing in the amount of $4.4 billion, which is 19% more than in the previous period.

In view of the crisis, a number of experts say that the real estate market is likely to see a slowdown in development. However, others argue that, along with the difficulties, there may be good opportunities that will generate large profits. In order to understand how the segment works and its dependence on macroeconomic changes, it is necessary to remember the past similar situations.
During the Great Depression, Americans faced high unemployment and a decline in industry. To save the economy, it was decided to invest in construction. To do so, they created state benefits for mortgage lending, which increased the demand for housing and became an incentive for developers.
The Caribbean crisis hit the US industrial segment significantly, and lending volumes soared. As a result, supply exceeded demand, and real estate prices fell. Then a law was introduced that protected citizens’ property in case of bankruptcy, and no housing was taken away.
In 2008, the mortgage crisis in the U.S. spread around the world, the cost of objects began to fall sharply, but lending programs for buying real estate were reduced. Only once the world economy rebounded, the construction market began to revive.