According to our 2011 Global Investment Atlas, global investment rose 42% in 2010 to US$564 bn (€430 bn), the 3rd highest total of the past 10 years. The recovery gathered pace in H2 2010 despite the more hesitant economic mood of that time, possibly reflecting the fact that liquidity and income are still more important drivers of demand than growth.
This latest report suggests that investment is forecast to rise just 5-10% this year, hitting US$606 bn (€485 bn), led by North America, with China slowing as policy is tightened.
Listen to David Hutchings, Head of the European Research Group explain that while opinions are still mixed, Cushman & Wakefield is now more optimistic that a sustained recovery is underway. In all sectors, the days of tenant power will soon be numbered in the prime markets as supply levels erode, but many secondary markets will remain under pressure for some while yet. Even there however, it will be interesting to see which areas are first to be picked off by either occupiers or investors as prices rise and availability falls in the prime market. Interesting times.
Sigrid Zialcita, Managing Director Reserarch, Asia explains how the Asia Pacific is expected to outpace the world economy once again in 2011. Domestic demand will remain strong, with sustained improvements in hiring and incomes. China and India will be the region’s star performers. Hong Kong and Singapore will remain the tightest office markets, while pockets of temporary weakness may appear in Shanghai and Mumbai due to the influx of new supply. Better office fundamentals will continue to spur investment activity particularly in the region’s financial centers – Hong Kong, Singapore, Shanghai, Tokyo and Sydney.
Listen to Ken McCarthy, Managing Director, US Research Services, explain how the recovery is here and is likely to gain momentum as 2011 progresses. The entire region will benefit from stronger growth in the US, but all the major countries in the America’s will be in full-fledged economic expansion mode. Healthy employment growth will contribute to declining vacancy in most markets, on average, and lead to a turn up in asking rents in the next 12 to 18 months. We are already seeing this trend take place in some markets.