With investors sitting on substantial amounts of dry powder and seeking to make up for lost ground, Colliers expects total investment activity to boost by up to 50% in 2021. According to Colliers International’s new Global Capital Markets 2021 Investor Outlook, 98% of investors across all regions aim to expand their portfolios this year, with about 60% seeking to expand by more than 10%, such as 23% who want to expand by 20% or more.
Colliers study points to a broad-primarily based renewal of activity in the house industry in 2021, as investors appear to deploy pent-up capital in higher-prospective markets and sectors. To provide some context, 1% of worldwide assets beneath management equates to about $1.65 trillion, which was the annual typical worldwide investment total from 2015-2019. With 2020 volumes falling to about $1.3 trillion and allocations to true estate continuing to expand, the weight of capital is potentially capable of doubling worldwide investment volumes need to industry situations permit.
The roll out of COVID-19 vaccines will have a pretty positive effect on markets and worldwide geo-political stability, courtesy of a Brexit trade deal and a US election outcome, provide significantly required certainty. These aspects will assistance drive industry development in 2021. Although a large proportion of investors are seeking to get out of the blocks early and recognize acquisitions in Q1, Colliers authorities think the rebound in activity will acquire strength from Q2 onwards due to lingering uncertainty more than travel in the very first quarter.
With the pandemic weighing on activity for significantly of final year, lots of investors are sitting on record money piles and anticipate considerable possibilities to emerge in industrial true estate, specially with continued stimulus most likely to make yields on equities and bonds comparatively significantly less desirable. Across regions, a clear majority of investors are preparing to expand their true estate portfolios in 2021, in lots of instances by double digits.
“The investment climate in India is very buoyant with interest from global investors to invest in real assets getting stronger. This is because global interest rates are at historic lows and India has emerged among the preferred destinations for investments in real estate that generate higher returns against the quality of assets available. The resilience of the Indian real estate markets is also evident from the continued positive sales performance across various markets in residential projects and the stable office occupancy post the COVID-19 outbreak,” mentioned Piyush Gupta, Managing Director, Capital Markets & Investment Services (India), Colliers International.
The report drew almost 300 respondents such as key institutional investors, listed house firms, sovereign wealth funds, private equity funds, household offices and third-party dollars managers.
EMEA Investors asset class & approach preferences for 2021
# The pie chart represents how usually each and every asset sort was selected relative to total responses supplied. For each and every asset sort, the % figure indicates the percentage of investors surveyed who chose this precise approach, whereby each and every investor could pick several tactics.
India is witnessing international capital inflows into markets. As per the survey, the best asset classes (exactly where investors are seeking at investing in 2021) for key markets like Bengaluru, Delhi NCR and Mumbai are industrial workplace, mixed-use and logistics. For Mumbai and Bengaluru markets, information centers ranked fourth, although it was residential assets for Delhi NCR.
Additional important takeaways from the Colliers Global Capital Markets 2021 Investor Outlook report consist of:
# Top-tier city offices stay a major asset target. Investors with international capital uncover the scale and liquidity of the workplace sector in key industrial hubs such as New York, London and Sydney attractive. Having workplace assets that meet well being, sustainability and technical benchmarks is critical to investors.
# Logistics and residential sectors are thriving. Both sectors had been amongst investors’ best 3 possibilities across all regions. Intense demand for these assets will call for investors to broaden their geographic concentrate and develop portfolios via joint venture platforms and regional partnerships.
# Opportunities to repurpose discounted retail and hospitality assets. Investors are expecting to see pricing discounts of more than 20 % in these sectors. They represent a uncommon chance to obtain distressed assets for ambitious repurposing initiatives.
# Alternatives, platforms and partnerships are playing a larger component. Rising demand for option true estate such as information centres, senior living and life science assets reflects broader structural shifts amplified by COVID-19.