Foreign Investment in U.S. Net-Lease Assets Help Drive Record Year in 2019

WORLD PROPERTY JOURNAL | February 28, 2020

Foreign Investment in U.S. Net-Lease Assets Help Drive Record Year in 2019
Global commercial property consultant CBRE is reporting this week U.S. net-lease investment reached record highs in 2019, with investors increasingly attracted to opportunities in high-growth secondary and tertiary markets. Net-lease investment--comprising office, industrial and retail properties--increased by 10.9% in 2019 to a record $77.5 billion, outpacing the growth rate of all commercial real estate. This was despite a 23% year-over-year drop in Q4 2019 volume to $19.5 billion--still 18.2% above the five-year average. Some of the largest annual gains for net-lease investment were in San Diego (+110%), the Inland Empire (+105%), Tampa (+56%), Indianapolis (+50%) and Memphis (+48%). Los Angeles ($5.0 billion), New York City ($4.9 billion) and San Jose ($4.2 billion) had the most full-year net-lease investment in 2019, while Seattle was the most favored market in Q4 2019 ($2.2 billion).

Spotlight

Demand for well located, high quality rental housing in our core markets remains exceptionally strong as favorable demographics and an improving economy combine to deliver operating results at the high end of our expectations portfolio wide," said David J. Neithercut, Equity Residential's President and CEO. "As a result, we currently expect full year growth in same store revenues of 4% and Normalized Funds from Operations to increase 9% per share.

Spotlight

Demand for well located, high quality rental housing in our core markets remains exceptionally strong as favorable demographics and an improving economy combine to deliver operating results at the high end of our expectations portfolio wide," said David J. Neithercut, Equity Residential's President and CEO. "As a result, we currently expect full year growth in same store revenues of 4% and Normalized Funds from Operations to increase 9% per share.

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