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News Release

Chicago, London, Singapore

Global real estate investment volume reached $677 billion in 2017

Real estate investment’s post-crisis high to soften in 2018

​Chicago, London, Singapore, January 12, 2018 – Investors continued to demonstrate their confidence in global real estate markets throughout 2017, with investment in the final quarter hitting its highest level in three years.

Despite continued political concerns, real estate markets mirrored the global economic recovery with Q4 volumes coming in at US$213 billion, bringing full-year activity to US$677 billion, 2 percent higher than 2016.

The broad-based growth, low interest rates, and lack of inflationary pressure seen across the world in 2017 have created an ideal environment for investors, says Pranav Sethuraman from JLL’s global Capital Markets team.

Even with the planned wind down of asset purchase programs and rising interest rates, strong fundamentals and positive market sentiment have prevented any major dampening in global markets which has, in turn, benefitted the real estate sector, he says.

Although well acknowledged to be in the late stages of the current cycle, investor appetite for the sector has remained consistent. And, while yields in many global markets sit at record-lows, healthy cash flow fundamentals have underpinned pricing.

But Sethuraman cautions that we’re unlikely to see the same highs in 2018 as a “relative lack of product combined with late-cycle discipline are likely to cause the market to soften by five to 10 percent and finish around US$630 billion.”

The changing market conditions will force investors to look to new strategies with a greater focus likely to be placed on “debt financing, M&A, and alternative sectors as the search for yield continues,’ he says.

Regional Overview

​Americas: U.S. continues decline as neighbours shine

Mirroring the previous three quarters, the Americas came in 18% lower in Q4 than the same period in 2016, at just US$64 billion, and bringing full-year activity down 13% to US$247 billion. At the epicenter of the decline was the U.S. which saw full-year volumes fall 16% to US$224 billion, the lowest since 2013. The story was different for the country’s northern neighbours with 2017 Canadian volumes up 22% to US$17 billion, 23% higher than the long-run average. Brazil proved itself a further bright spot, outperforming after years of relatively slow activity with full-year volumes up 166% to US$ 3.9 billion.

EMEA: UK and Germany lead EMEA high

Investors continue to clamour for European real estate, causing fourth quarter volumes to surge by 20% to US$101 billion. The region has had a strong year with full-year volumes up 16% to US$284 billion, further boosted by the continued weakness of the U.S. dollar which has helped increase volumes in dollar terms. The UK has led the performance, with annual volumes up 32%, despite Brexit uncertainty. While fourth quarter activity dipped in Germany, the country’s strong start meant full-year volumes finished up 5% higher than 2016 and contributed to the regional strength. Elsewhere, the Netherlands enjoyed a record breaking year with volumes reaching US$23 billion, 55% higher than the previous peak in 2007. The success story continued into Southern Europe with Italy and Spain seeing activity pick up by 19% in 2017 while Greece and Portugal were up 37% and 40% respectively.

Asia Pacific: Record final quarter for the region

For the second year in a row, Asia Pacific set a record in the final quarter as investment hit US$49 billion, 9% higher than the previous record set in Q4 2016, and bringing full-year volumes 11% up to US$146 billion. China and Japan, the region’s two largest markets led the way, with annual activity up 5% and 6% respectively. Strong demand meant Hong Kong finished the year on a record high of US$16 billion, 59% up on last year while Australia (12%) and Singapore (20%) also recorded positive full year growth.

​About JLL

JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. A Fortune 500 company, JLL helps real estate owners, occupiers and investors achieve their business ambitions. In 2016, JLL had revenue of $6.8 billion and fee revenue of $5.8 billion and on behalf of its clients managed 4.4 billion square feet, or 409 million square meters, and completed sales acquisitions and finance transactions of approximately $145 billion. At the end of the third quarter of 2017, JLL had nearly 300 corporate offices, operations in over 80 countries and a global workforce of over 80,000. As of September 30, 2017, LaSalle Investment Management had $59.0 billion of real estate under asset management JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated.

In Russia and CIS JLL has offices in Moscow, St. Petersburg and Kiev. JLL, Russia & CIS was voted Consultant of the Year in 2004, 2006-2017 at the Commercial Real Estate Awards, Moscow; Consultant of the Year at the Commercial Real Estate Awards 2009, 2016, St. Petersburg; Consultant of the Year at the RCSC Awards in 2015.