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MIPIM 2015: Global RE investment to hit $1.34 trillion

Europe and US will lead the way to an 11 percent rise in volumes this year, according to property services firm Cushman & Wakefield

MIPIM, the annual global property get-together in Cannes, got under way today with the traditional plethora of data snaps, including how Chinese land deals led global transactional deal volume down in 2014.

As most real estate delegates at the trade show chink champagne glasses thanks to buoyant real estate transactional levels, agent Cushman & Wakefield said global real estate investment had actually fallen for the first time in five years by 6.3 percent to $1.21 trillion.

However, that decline could be solely attributed to a drop in Chinese land purchasing, said Cushman & Wakefield in its annual global capital markets report. China aside, the report confirmed what real estate delegates thought was the case all along: that deal volume is rising.

Looking back to 2014, the report stated that while excess capacity in some parts of the property market and past previous policy tightening had a negative impact on Chinese investors and developers. However, excluding China land sales, global volumes rose 9 percent.  Further, ignoring China, global investment levels, and are set to rise an additional 11 percent in 2015 to $1.34 trillion, led by Europe and the US. 

David Hutchings, head of EMEA investment strategy at Cushman & Wakefield, said: “The 2014 pick-up was better than many predicted this time last year but the 2015 outlook is stronger still, with the brakes now coming off the market. Not only do we have strengthening global liquidity thanks to low interest rates and an expansion in quantitative easing, we also have the start of stimulus measures by China, signs of deeper reform in more markets and an improvement in the fundamentals for the occupier in many areas. Despite the heightened risks we also have to contend with, this all points to the up cycle in global real estate being both magnified and extended.” 

Against that background, some 21,000 delegates from around the world are descending on the MIPIM trade fair in the south of France for the week-long event.

International developers, local authorities, property services firms, and fund managers including private equity real estate firms have a presence, hosting and attending private meetings, press conferences, evening soirees and parties.

PS: our reporter, Thomas Duffell, is roving at MIPIM. He can be contacted at Thomas.d@peimedia.com