Foreign Buyers Making Deals
SOURCE: The Washington Post
Foreign investors are taking advantage of the lack of competition in the U.S. commercial real estate market. According to a first-quarter survey by the Association of Foreign Investors in Real Estate (AFIRE), their international investors rank the U.S. as the most attractive market in the world.
The lack of competition in the U.S. market is being driven largely because private U.S. buyers are hard pressed to find money due to the credit crunch. Also, more conservative investors are waiting for prices to continue falling. This combined with the fact that the inventory of upper echelon Class A commercial buildings is relatively small is making for some record breaking deals.
The foreign investors aren't getting bargains. They are paying a premium price for a solid tenant base. These properties are typically fully leased with long term, credit-worthy tenants. This is a great hedge to have against the volatile market that the U.S. is experiencing.
Foreign investors are finding that now there are fewer domestic investors due to loans being scarce, they have the time needed to familiarize themselves with the commercial real estate market. With the dollar worth less compared to many foreign currencies and the market down, foreign investors could be getting a double discount on U.S. real estate.
Foreign investors are taking advantage of the lack of competition in the U.S. commercial real estate market. According to a first-quarter survey by the Association of Foreign Investors in Real Estate (AFIRE), their international investors rank the U.S. as the most attractive market in the world.
The lack of competition in the U.S. market is being driven largely because private U.S. buyers are hard pressed to find money due to the credit crunch. Also, more conservative investors are waiting for prices to continue falling. This combined with the fact that the inventory of upper echelon Class A commercial buildings is relatively small is making for some record breaking deals.
The foreign investors aren't getting bargains. They are paying a premium price for a solid tenant base. These properties are typically fully leased with long term, credit-worthy tenants. This is a great hedge to have against the volatile market that the U.S. is experiencing.
Foreign investors are finding that now there are fewer domestic investors due to loans being scarce, they have the time needed to familiarize themselves with the commercial real estate market. With the dollar worth less compared to many foreign currencies and the market down, foreign investors could be getting a double discount on U.S. real estate.
