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top 10 capital flows by country
2020 | U.s. Inbound investment trends
Foreign investment in U.S. industrial & logistics assets increased by 36% from 2019, attracted by a strong average return of 12% in 2020, according to the National Council of Real Estate Investment Fiduciaries (NCREIF). Foreign investment in U.S. multifamily assets was down by 23% from 2019 but up by 7% in H2 2020 from H2 2019. Conversely, foreign investment in U.S. office and retail assets has remained weak since the start of the pandemic. A rebound for these sectors will depend either on cap rate expansion or an end to the pandemic.
U.S. investment in foreign industrial and alternative (operational real estate) assets in 2020 increased by 31% and 19%, respectively, from 2019. This trend is expected to continue as U.S. investors showed strong confidence in future capital appreciation of industrial and alternative assets. Multifamily assets remained a major target too, with just a 2% decrease from 2019. U.S. investment into U.K. multifamily assets surged by 145% year-over-year.
For the first time, industrial replaced office as the largest sector for U.S. capital outflow. The prevalent remote-working trend impacted investor preferences abroad.
2020 | U.s. outbound investment trends
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TOP DESTINATIONS
Toronto $209M
Montreal $194M
Calgary $23M
TOP DESTINATIONS
Paris $2.2B
Amsterdam $1.5B
Berlin $919M
TOP DESTINATIONS
Puerto Rico $206M
Mexico $175M
Anguilla $72M
TOP DESTINATIONS
Yokohama $898M
Guangzhou $666M
Seoul $430M
Note: All figures in U.S. dollars. Includes entity-level deals unless stated otherwise. Transactions include office, retail, industrial, residential/apartment and seniors housing. Development sites are excluded.
Source: CBRE Research, Real Capital Analytics, January 2021.
Disclaimer: Information contained herein, including projections, has been obtained from sources believed to be reliable. While we do not doubt its accuracy, we have not verified it and make no guarantee, warranty or representation about it. It is your responsibility to confirm independently its accuracy and completeness. This information is presented exclusively for use by CBRE clients and professionals and all rights to the material are reserved and cannot be reproduced without prior written permission of CBRE.
Inbound by Sector
Outbound by Sector
CANADA
EMEA
APAC
Latin America & the Caribbean
SOURCES OF INBOUND CAPITAL TO U.S.
TOTAL OUT OF U.S.
$41.6B
$58.4B
vs.
2019
2020
$1.4B
$31.9B
$7.8B
$463M
vs.
2019
2020
TOTAL INTO U.S.
single ASSET/PORTFOLIO
ENTITY LEVEL
$28.0B
$37.6B
$0.0B
$2.9B
SEATTLE
$2.2B
ATLANTA
$1.4B
Dallas
$1.1B
manhattan
$3.2B
single ASSET/ PORTFOLIO
ENTITY LEVEL
$184M
$10.0B
$7.0B
$10.7B
$0.0
$0.0
$0.0
SAN FRANCISCO
$1.2B
country
AMOUNT
% OF TOTAL
$10.5B
36.6%
CANADA
Germany
$3.2B
11.3%
switzerland
$1.4B
4.8%
FRANCE
$769M
2.7%
singapore
$2.5B
8.8%
Kuwait
$690M
2.4%
japan
$718M
2.5%
israel
$751M
2.6%
south korea
$3.4B
11.7%
U.K.
$1.5B
5.1%
destinations of U.S. outbound capital
country
AMOUNT
% OF TOTAL
U.K.
$11.6B
26.7%
Germany
$6.7B
15.4%
france
$2.7B
6.3%
italy
$1.1B
2.6%
spain
$1.6B
3.7%
netherlands
$4.2B
9.6%
canada
$1.4B
3.2%
japan
$3.5B
8.1%
india
$3.1B
7.2%
CHINA
$2.2B
5.1%
Investors from Singapore and South Korea acquired significantly more U.S. assets in 2020 than in 2019 with a focus on core office assets in markets like Seattle and San Francisco and logistics assets across the U.S. Investment from Canada and Germany both fell by 8%, while Chinese investors continued to retreat. Though not among the top five capital sources, U.K. investors increased their U.S. investment volume by 10% year-over-year.
five-year trend*
Among the top five destinations for U.S. outbound capital, the Netherlands had a 25% increase in U.S. investment last year, mainly for multifamily assets. Despite a slowdown in H2, the U.K. remained the most popular foreign market for U.S. investors, with $12 billion worth of transactions in 2020, down by 10% from 2019. U.S. investors remained active in almost all sectors except office. Beyond the top five, U.S. investment increased in Japan and China, possibly due to the region’s effective management of the pandemic.
five-year trend*
*Top 5 countries based on total U.S. outbound capital between 2016 and 2020.
*Top 5 countries based on inbound capital between 2016 and 2020.
Note: Excluding entity-level volume.
$0.0
Top Markets
By Annual Growth Rate from 2019*
(volume in US$ Millions)
by Total Investment in 2020
(volume in US$ Billions)
Among the top five U.S. markets for inbound capital in 2020, excluding entity-level transactions, only Atlanta had a year-over-year increase (3%). This was credited to Atlanta’s robust industrial market growth. The office sector in Manhattan and Dallas cooled in 2020 due to low cap rates and market uncertainty. Among the fastest-growing markets, Indianapolis and Inland Empire stood out for industrial supply growth, while California markets like San Diego and Sacramento continued to draw foreign capital into the apartment sector.
*Excluding entity-level volume. Limited to markets where 2020 inbound volume >$250M.
Sacramento: 206%
Other NYC: 175%
Denver: 86%
Memphis: 44%
Oakland: 33%
H1 2020 vs. 5YR H1 AVG.
Manhattan: -47%
Los Angeles: -75%
Chicago: -84%
San Francisco: -96%
Dallas: -44%
H1 2020 vs. 5YR H1 AVG.
by Total Investment in 2020
(volume in US$ Billions)
By Annual Growth Rate from 2019*
(volume in US$ Millions)
*Excluding entity-level volume. Limited to markets where 2020 and 2019 outbound volume >$250M respectively.
Sacramento: 206%
Other NYC: 175%
Denver: 86%
Memphis: 44%
Oakland: 33%
H1 2020 vs. 5YR H1 AVG.
Manhattan: -47%
Los Angeles: -75%
Chicago: -84%
San Francisco: -96%
Dallas: -44%
H1 2020 vs. 5YR H1 AVG.
While U.S. investors favored developed European markets such as Paris and Amsterdam in 2020, they were increasingly comfortable with key markets in Central and Eastern Europe, as well as Asia. U.S. investment in Shanghai and Copenhagen more than doubled from 2019.
Yokohama, Japan entered the top five markets with one sizeable office transaction. In the office sector, U.S. investors looked beyond gateway markets for higher returns.
Top Markets
-89%
-70%
-85%
-91%
-80%
-87%
-93%
-91%
-92%
-69%
5-Year
24%
-7%
11%
47%
232%
-34%
81%
-55%
-27%
-57%
5-Year