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January 26, 2012

Global Real Estate Investment Report by Jones Lang LaSalle

Real Estate Investment

Real Estate Investment

The “A New World of Cities” report by Jones Lang LaSalle reveals that more than half of all global real estate investment resides in 30 cities. A quarter of the total investment is in five top-tier cities: London, Tokyo, New York, Hong Kong and Paris. This is set to change by the turn of the decade, however, when newer destinations such as Beijing, Shanghai, Moscow and Sao Paulo will become serious contenders for real estate dollars.

Jones Lang LaSalle is a financial and professional services firm specializing in real estate. With 2010 global revenue of more than $2.9 billion, Jones Lang LaSalle serves clients in 70 countries from more than 1,000 locations worldwide.

“We are already seeing a shift in where real estate investors are sending their capital,” said Peter Roberts, CEO, Americas, Jones Lang LaSalle. “The top 30 cities for real estate investment will become the top 50 as investors diversify their portfolios and corporate occupiers expand their geographic footprints to include emerging cities. Advances in digital communications contribute to this expansion because companies will no longer have to physically cluster in some of the world’s largest cities.”

Real Estate Investment


According to LaSalle, cities in China are being transformed by an unprecedented programme of development and modernization.

While much global attention has been paid to the growth of Asian cities, U.S. cities provide a strong counter-balance. Nearly half of the world’s office stock is located in the U.S., and more than one third of all commercial real estate investment takes place in U.S. cities. Eleven of those cities are expected to feature among the world’s top 30 largest cities by GDP by 2020. Six of the top 30 fastest growing cities in terms of absolute GDP will be in the U.S., including New York, Los Angeles, Chicago, Washington DC, Dallas and Houston, says the report.

Real Estate Investment


Despite European economic turmoil, London has remained the top real estate investment pick with more than $43 billion invested in 2010 and the first three quarters of 2011, a third higher than the world’s second most popular destination, Tokyo.

Real Estate Investment


We believe that this will be the ‘decade of change’ as investors widen their horizons across a much broader range of 300+ cities, not only in new emerging markets but also in secondary and tertiary cities in mature economies. Deepening real estate transparency, faster economic growth rates and the improving quality of the real estate stock in emerging and middle-weight cities will act as compelling pull factors; so too will investors’ active pursuit of major corporate occupiers, who are extending deeper into new geographies. Conversely, the potential decline in the global economic weight of high-order cities - as the digital world erodes the need for physical clustering and their business cycles become increasingly synchronized - could act as a critical push factor and reduce the relative attraction of high-order cities for real estate investors over the longer term. By 2020, the ‘top 30’ is more likely to be the ‘top 50’ as cities such as Mexico City, Delhi and Istanbul join the top echelons of investible cities, the report concludes.



“What is the city but the people?”

— WILLIAM SHAKESPEARE, Coriolanus. StumbleUpon reddit Facebook Google Plus Tweet This Seed This on Newsvine

Edited & Posted by the Editor | 6:41 AM | Link to this Post

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