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EMEA's Q1'22 Cross-border Real Estate Transactions Highest Globally at  $36.4B

EMEA's Q1'22 Cross-border Real Estate Transactions Highest Globally at $36.4B

Last updated 5th Aug 2022
Disclosure
  • The global real estate market has rebounded from the pandemic's shocks.
  • That recovery resulted in a strong Q1 2022 showing.
  • EMEA countries remain the most attractive for investors, having drawn $36.4B in funding then.

At its peak, the coronavirus crisis severely dented cross-border real estate transactions. But two years later, many nations have largely contained the epidemic, and things are looking up again. The sector is one of 2022’s bright lights, having shaken off the pandemic’s shocks. Its first-quarter transactions exceeded $62 billion, a record for Q1 exchanges.

BanklessTimes has presented data placing the EMEA region at the apex of attracting cross-border real estate transactions. BanklessTimes concludes that the region’s property market drew interests worth $36.4B. That figure comes to 59% of the global total and more than doubles similar investments in the Americas.

Jonathan Merry is BanklessTimes’ chief executive. He has been studying the trends in the sector and shares his opinion on the news. He says:

The property sector within the EMEA region made the best recovery from the pandemic’s effects. Moreover, it retained 80% ($13.3B)of its purchase capital, whereas the Americas and APAC regions had significant outflows from theirs. That coupled with its ability to attract investments from the other two areas gave it an upper hand over them.
Jonathan Merry

How did the Other Regions Fare?

The Americas came second after attracting investments amounting to $17.4 billion. That figure is 28% of the global total. A deep dive into the area’s data reveals a striking detail. First, the region shipped $9.5B out of its $12.2B purchase capital to EMEA and APAC countries. Most of those funds ($8.4B) went into investments in the former.

Meanwhile, the APAC zone attracted the least investments at $8.3B. It also had the least purchase capital, which stood at $11.5B. Like the Americas, the territory invested most of its funds ($5.5B) in EMEA’s real estate sector. Its huge outlay to the latter region explains the $3B difference between its purchase capital and the investments it attracted.

The fourth category of investment funds came from individuals and entities that don't associate with any of the three territories. This group of "global" citizens raised nearly $22B of the world's cross-border real estate purchase funds. Again EMEA got a substantial $9.3B from this kitty.

Interest in Residential and Logistic Properties is on the Rise

BanklessTimes' analysis has also shown how different market segments have fared from 2007 to Q1 2022. Residentials and logistics have had steady increases in that time. For instance, interest in residential properties has risen from an average of 15% in 2007 to 28% in Q1 2022. Likewise, logistics saw an uptick from 10% to 19%.

On the flip side, retail and logistics have had poor runs. Investments in the office segment have dropped from a high of 45% to 28% within that time frame. Meanwhile, interest in retail has slumped from 25% to 13%. Other sectors like hotels and warehousing also registered a drop from 15% to 12%.

Investors Need to Exercise Caution

Although the pandemic's effects have waned significantly, other challenges have emerged. These include mounting inflation, tightening the monetary policy, and the risks associated with the Russia-Ukraine war.

Although these have had very little effect on the markets, they may increase in significance moving forward. The real estate sector could still maintain its current bullishness. But in the face of growing risks, investors could do well to pursue their interests with some degree of caution.

Elizabeth Kerr

Elizabeth Kerr

Elizabeth is a financial content specialist from Manchester. Her specialities include cryptocurrency, data analysis and financial regulation.