Global institutional fund allocations to property according to published IPE data: 2013 (8.9%), 2014 (9.4%), 2015 (9.6%), 2016 (9.9% forecast). Assuming global funds under management of around $36 trillion, the increase in the last two years has been $233 billion. This is 28% of total global direct property investment to around $850 billion (RCA). Given this existing weight of capital and given further increases in allocations, if all of this money found a home in property, it would push direct transaction volumes to well beyond 2007 levels to over $1.2 trillion.
 
Investors turn to Europe for greater value
European volumes are expected to increase further in 2016 driven by a variety of prime markets and attractive lending conditions. However, fewer investors expect to be net buyers. US investors remain committed to Europe, with a third of them planning to invest in EMEA during the next 12 months.
 
This is being particularly driven by opportunity-led American private equity, which is shifting from UK to continental Europe because it can achieve higher returns.
 
Investors from outside EMEA will typically have more of a narrow focus around London, Paris and the key German cities, with Madrid also on the radar. Asian capital will continue to focus on London and German cities in 2016, underscoring investors’ reduced appetite for risk.

Investors top 10 target destinations
US 79%
UK 55%
Germany 51%
Australia 40%
France 34%
Japan 32%
Spain 25%
Singapore 22%
Netherlands 21%
Canada 19%

John B. Friedrichsen, Chief Financial Officer at Colliers International, said: “Our global analysis in this report gives a unique macro-view, providing a comprehensive look at the health of the economy as well as in-depth views of market sentiment that serve as a useful bellwether for local markets worldwide.”
  
The Colliers Global Investor Outlook (GIO) report can be downloaded here.
 
Check out the video highlights or visit the microsite at http://gio.colliers.com/.