London took first place in global ranking by the Association of Foreign Investors in Real Estate in its 26th annual survey of top international cities for capital appreciation and stability. Obviously the Association is less concerned about Brexit this year than it was last year as London jumped from third to first place.
As far as countries are concerned, the United States came in first for planned real estate investment in 2018 by the Association. The United Kingdom, Germany, Canada and France respectively rounded out the top five countries offering the best opportunities for investment appreciation.
The Association of Foreign Investors in Real Estate has some $2T in real estate assets under management throughout the world.
The Association determines its top 10 cities by compiling the number of times the city was ranked 1st, 2nd or 3rd by survey respondents. Here are this year’s survey rankings for its top 10 cities:
New York 37.0
Los Angeles 26.0
San Francisco 8.0
These results represent a “…dispersal of votes and a broadening of the investors’ interests into other cities in the U.S.,” said the Association CEO, Jim Fetgatter. “Los Angeles, Frankfurt, Paris, Seattle and Shanghai all got more votes this year than last…this may be a sign of general global optimism for business.”
Los Angeles, ranked 4th for the first time, was of particular interest to the Association this year due to its port, the largest in the world. “With the growth of online shopping, foreign investors continue to rank industrial/logistics properties as their number one investment opportunity,” said Fetgatter.
New York, the consistent 1st place finisher, fell to 2nd place and San Francisco fell from the top 5 to 10th for the first time since 2011. Less opportunity for investment appreciation was the cause in both cases. Washington DC also fell from 15th to 25th this year for the same reason.
Fetgatter does not “necessarily see the recent US tax overhaul as a boon” to real estate but rather a preservation of status quo for the industry. “Investors will benefit from a far lower corporate tax rate which will…increase their incomes.”
Compiled by James A. Graaskamp at the Center for Real Estate at the University of Wisconsin School of Real Estate in December 2017, this 26th annual survey of global markets as seen by the Association of Financial Investors in Real Estate gives all real estate professionals a wide lens with which to view their specific expertise.