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News Release

Budapest

Increased appetite for global real estate as U.S. posts 30% jump in Q2


EMEA, Budapest, 21st July 2015 - The U.S. leads global commercial real estate investment in the second quarter of 2015 after posting a 30 percent rise in transaction volumes, as full year global forecasts hit US$750-760 billion.

Despite the debt crisis in Greece and volatility in China’s equity markets, Q2 2015 prelim data from JLL shows global transaction volumes in the second quarter of the year totalled US$161 billion, unchanged from the same period a year ago.
The Americas, as a whole, posted the best second-quarter performance since 2007, at US$79 billion, as the U.S. economy recovers while Russia shows signs of renewed optimism with the strongest level of activity seen in five quarters.
In Asia Pacific, lower transactions in Japan and Australia – the region’s biggest markets – pulled volumes down. In EMEA, transaction volumes were up 11 percent, measured in local currencies.
“We can expect the recent decline in global interest rates to support transactional activity for the remainder of 2015,” says David Green-Morgan, Global Capital Markets Research Director at JLL.

Regional highlights:

Americas: U.S. recovery gaining momentum
Transactional volume in the Americas climbed 18 percent both on a year-on-year and year-to-date basis, supported by growth in the U.S. In Canada, volumes are down 20 percent year-to-date.
Managing Director and leader of the firm’s Canadian Capital Markets, Matt Picken, says the volume drop in Canada is due to the significant supply and demand imbalance.

“We have far more buyers than sellers here, all with a voracious appetite but no product to satisfy the demand,” says Picken. “Rather than acquiring portfolios or even single assets, institutional capital in this country is now turning to development.  The development pipeline has everything from high rise office in major cities to industrial and mixed-use projects, but we do expect sales volumes to bounce back significantly in the second half of 2015 as well.”

EMEA: Greece’s debt crisis takes backseat
Southern Europe posted a 47 percent growth in the first six months. The UK, France and Germany were each up 15 percent in the same period while Nordic investment was up 38 percent.
Asia Pacific: The strong U.S. Dollar bites
Transactional volumes fell 19 percent in U.S. Dollar terms as the region was affected by the strength of the greenback, although Hong Kong was a standout with volumes up 88 percent. This was despite the ongoing political turmoil.

Hungary
“While volumes in Hungary are flat compared to the same period of last year at roughly EUR 290 million, we expect a much stronger second half that should translate into 2015 full year numbers 20-30% above the 2014 level. The good piece of news is that the liquidity is coming back across all asset classes and for different investment ticket sizes” - commented Benjamin Perez-Ellischewitz, Head of Capital Markets at JLL Hungary.

Rita Tuza, Head of Research, JLL Hungary added: “The improving market fundamentals manage to fuel the appetite for Hungarian assets and the bullish occupational activity of the office market is especially remarkable. No surprise that the most sought after asset class was offices, representing 34% of the half-year transactional volumes.