New report by Colliers International reveals 98% of investors plan to expand their portfolios
Colliers International reveals investors are largely optimistic about a market rebound in 2021, according to its new Global Capital Markets 2021 Investor Outlook. Colliers’ research anticipates a 50% surge in investment activity in the second half of the year, pointing to a broad-based renewal of confidence in the property market as a result of recent vaccine developments and continued government stimulus. Baltic markets are not an exception. Fortunately, we expect there will be opportunities both for those who will want to play it safe and for those who want to use the momentum to get accelerated returns.
“Based on Colliers global analysis, strategic plans in the property sector remain intact. With a massive volume of equity raised globally and the need for real assets, global investors are eager to deploy pent-up capital and pursue opportunities during the year,” said Angela Kolesnikova, Head of Investment Department at Colliers Baltics. “Colliers expects to see movement up the risk curve this year, with global investors exploring all types of assets from senior care homes to public infrastructure projects. Baltic investors will also need to work on their risk tolerance if they want to stay competitive for prime assets this year, especially in industrial segment.”
The report, which drew nearly 300 respondents including major institutional investors, listed property companies, sovereign wealth funds, private equity funds, family offices and third-party money managers, indicates 98% of investors across all regions aim to expand their portfolios, with approximately 60 per cent looking to expand by more than 10%. Furthermore, 67% of survey respondents in EMEA and 88% of those in the U.S. are planning their next investment as early as the first quarter of 2021.
Additional key takeaways from the Colliers Global Capital Markets 2021 Investor Outlook report include:
- Top-tier city offices remain a primary asset target. Investors with international capital find the scale and liquidity of the office sector in major commercial hubs such as New York, London and Sydney appealing. Having office assets that meet health, sustainability and technical benchmarks is important to investors.
- Logistics and living sectors are thriving. Both sectors were among investors’ top three choices across all regions. Intense demand for these assets will require investors to broaden their geographic focus and build portfolios through joint venture platforms and local partnerships.
- Opportunities to repurpose discounted retail and hospitality assets. Investors are expecting to see pricing discounts of over 20 per cent in these sectors. They represent a rare opportunity to acquire core and distressed assets for ambitious repurposing initiatives.
- Alternatives, platforms and partnerships are playing a bigger part. Rising demand for alternative assets such as data centres, senior living and life science assets reflects broader structural shifts amplified by the pandemic.