The volume of real estate deals on a global scale rose to $292 billion in the third quarter of 2021, 77% more than last year. The volume of investment in the EMEA region rebounded above 68,000 million euros, 26% more year-on-year, while the volume so far this year stands at 191,000 million euros, according to JLL.
The combination of strong deployment and interest in high-quality core / core-plus assets in the quarter pushed volumes so far this year to an all-time high of $ 757 billion (50% YoY) globally. In terms of the EMEA region, Germany was the main driver of profitability, with volume growth so far this year of 22% year-on-year to 50 billion euros, closely followed by the United Kingdom, which registered a volume of 48,000 million euros, reveals JLL's Global Real Estate Perspective report.
"It has been an impressive quarter for the tertiary real estate market, whose post-pandemic recovery is in full swing. Those sectors that showed resilience over the past year received more investment and have registered strong growth, while those that experienced uncertainty are also recovering their attractive. We expect Germany, UK and France to perform well, as they did in the quarter, but we are also seeing new highs in Sweden, Ireland, Poland and Italy, which will attract some of the more established investors into new markets. for the rest of the year, "says Adam Challis, executive director, research and strategy for the EMEA region at JLL.
In the third quarter, investors remained highly focused on diversifying their portfolios, showing interest in increasing exposure to sectors favored by demographic trends and that have resilient demand from end users, such as living rooms and logistics. In parallel, confidence is increasing in sectors lagging during the current recovery, including retail and offices.
The living sector has received investments worth 219,000 million dollars so far this year, 80% more than in 2020 and 36% higher than in 2019. Currently, this sector is the most active in the world. , ahead of offices, and has received 29% of operations so far this year. Although activity has been mainly concentrated in the US (which represents 72% of world investment in living in 2021), global volumes are increasingly underpinned by growing investment in this segment in Germany, the United Kingdom and France. Japan continues to attract interest from cross-border capital; thus, 30% of the investment in living this year corresponds to international buyers, according to the JLL study.
As for the industrial and logistics sector, it has abundant liquidity, having registered an upturn in investments of 78% year-on-year so far this year. Volumes targeting high-priced deals exceeded $ 13 billion at the end of the third quarter.
At this time, total retail investment accumulates an increase of 35% year-on-year (compared to 31% in the first half of 2021), a percentage that stands at 27% in the case of office activity. Although there are large differences in the confidence that different classes of retail assets generate, capital is beginning to expand beyond food retail and lifestyle / leisure centers. On the other hand, capital is returning to the offices, with high-quality assets as the main beneficiaries.
"Despite clearing the market uncertainty, capital is not in short supply, and we are seeing truly innovative real estate allocation formulas, with an increase in joint ventures and corporate operations. The powerful combination of fewer deals over the past year. last year and the abundance of capital available for investments begins to generate a prolonged period of agreements and corporate operations, something that we will have to be pending in the next quarter and for the next year ", adds Challis.