$12 Billion Capital Surplus for U.S. Commercial Real Estate
More capital crossed U.S. borders in both directions during H1 2018, with foreign inflow up by 29% from H1 2017 and U.S. outflow up by 15%. Research by CBRE found, on net, the U.S. commercial real estate market had a capital surplus of roughly $12 billion.
Total investment into the U.S. totaled $29.7 billion in H1 2018, according to CBRE, compared to $23 billion in H1 2017. The most active foreign sources of investment into the U.S. were EMEA ($12.3 billion), APAC ($9.9 billion) and Canada ($7.1 billion). Manhattan saw the most in-flow of foreign capital at $3.6 billion, followed by Los Angeles ($3 billion) and Chicago ($970 million).
Savvy foreign investors have several strategies to mitigate foreign exchange risk when acquiring U.S. assets, one of which is purchasing forward contracts to hedge against U.S. dollar depreciation. The cost of hedging against U.S. dollar depreciation is rising, which reduces effective yields for many foreign investors, despite the growth and liquidity U.S. investments may offer, notes CBRE. That easing of inbound capital flows over the past 24 months has provided more opportunities for domestic investors.
French company Unibail-Rodamco’s acquisition of Westfield, which included a $7.7 billion shopping mall portfolio, elevated inbound capital flows from REITs and France, as well as foreign retail acquisitions, to record highs.
Dennis Kaiser is Vice President of Content and Public Relations for Connect Commercial Real Estate. Dennis is a communications leader with more than 30 years of experience including as a journalist and in corporate and agency marketing communications roles. He is responsible for Connect’s client content operations and is involved in a range of initiatives ranging from content strategy, message development, copywriting, media relations, social media and content marketing services.
In his most recent corporate communications roles, he led a regional public relations effort across Southern California for CBRE, played a key marketing role on JLL’s national retail team, and was responsible for directing the global public relations effort at ValleyCrest, the nation’s largest commercial landscape services company.
In addition to his vast commercial real estate experience, Dennis has worked on communications and launch strategies for a number of residential projects such as Disney’s Celebration in Florida, Ritter Ranch in Palmdale California (7,200 homes, 22,000 acres), WaterColor in Florida and PremierGarage in Phoenix.
Dennis’s agency background included firms such as Idea Hall and Macy + Associates. He has earned an outstanding reputation with organization leaders as a trusted advisor, strategic program implementer, consensus builder and exceptional collaborator.
Dennis has developed and managed national communications programs for Fortune 500 companies to start-ups, both public and private. He’s successfully worked with journalists across the globe representing clients involved in major-breaking news stories, product launches, media tours, and company news announcements.
Dennis has been involved in a host of charitable and community organizations including the American Cancer Society, Easter Seals, BoyScouts, Chrysalis Foundation, Freedom For Life, HOLA, L.A.’s BEST, Reach Out and Read, Super Bowl Host Committee, and Thunderbirds Charities.
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