MidEast investors pump $11.5bn into global real estate in H1

Qataris are most active with nearly $10bn of deals while London remains main focus of investments
MidEast investors pump $11.5bn into global real estate in H1
London is the main beneficiary of investment during the first half of 2015, receiving $2.8 billion and representing 24 percent of Middle Eastern outbound capital.
By Staff writer
Wed 09 Sep 2015 01:47 PM

Middle East investors pumped $11.5 billion into direct real estate globally during the first half of 2015, according to latest research from global property advisor CBRE Group.

The figure compares to total Middle East outbound investment during the whole of 2014 of $13.8 billion.

Qatar remained the largest source of outbound capital from the region, investing a total of $9.834 billion, the research showed.

CBRE said London is the main beneficiary of investment during the first half of 2015, receiving $2.8 billion and representing 24 percent of Middle Eastern outbound capital.

Notable deals included the $2.47 billion Qatar Investment Authority’s acquisition of Maybourne Hotels and the $110 million purchase of the London Midtown office by a private investor.

Hong Kong came in second with $2.4 billion, followed by New York with $1.1 billion, the research showed.

Despite weakening oil prices, acquisitions by sovereign wealth funds increased during H1. Sovereign spending stood at $8.3 billion, representing more than 72 percent of total spend.

However, the H1 results were boosted by two large hotel acquisitions at $2.5 and $2.4 billion each – one in London and the other in Hong Kong, by two different SWFs.

Nick Maclean, managing director, CBRE Middle East, said: “The size of the region’s foreign investment makes the Middle East the third-largest source of cross regional capital globally as Arab investors look for brighter investment prospects internationally.

"Qatar remains the largest source of outbound capital investing a total of $9.834 billion, while the UAE invested $6.64 billion in global assets during the 2014 and the first half of 2015 combined.”

CBRE said Middle Eastern investors are becoming more active across a wider range of sectors, with the hospitality industry showing an upward trajectory and a much greater sense of optimism.

Their outbound investments in hotels totaled $6.8 billion in the first half of 2015; a gigantic leap compared to $ 1.8 billion for 2014 as a whole.

Iryna Pylypchuk, Global Research, CBRE, said: “Real estate investors from the Middle East continue to play a very important role across a broader selection of global real estate markets.

"Recent acquisitions in AsiaPac – with close to $3 billion invested in Hong Kong and Sydney in H1 2015 alone - as well as a broader selection of markets invested in Europe showcase the on-going evolution of their investment strategies.

"This extends to sector selection, with hotels growing in importance recently as sovereign wealth funds and high-net-worth individuals focus on real assets that generate long-term revenue.”

For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

Subscribe to our Newsletter

Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.