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News release

CHICAGO, LONDON, SINGAPORE

Jones Lang LaSalle: 2011 Global Commercial Direct Real Estate Investment Proves Resilient

Confidence returning to the Americas with $155B in preliminary transaction volume for 2011; up nearly 60 percent over 2010


CHICAGO, LONDON, SINGAPORE, Jan. 11, 2012 – Preliminary numbers from Jones Lang LaSalle’s Year End 2011 Global Capital Flows report show there was US$400 billion of direct investment into commercial real estate in 2011, a 25 percent increase over 2010.  Highlights from the report include:
  • Preliminary 2011 volumes up 25 percent on full year 2010 at US$400 billion
  • Q4 2011 volumes were three percent higher than Q3 2011
  • Q4 2011 was the second US$100B+ quarter of the year
  • Compared to Q4 2010 investment transactions were down 10 percent in Q4 2011
  • 2012 volumes set to match 2011, but with downside risks
David Green-Morgan, Global Capital Markets Research Director at Jones Lang LaSalle commented, “Despite the numerous country, regional and global economic headwinds, commercial real estate continued to attract capital from investors who are looking at opportunities not only domestically, but also within their own regions and other regions globally.”

In the fourth quarter of 2011 volumes were 3 percent higher than the third quarter 2011, at US$102 billion.  The US$102 billion fourth quarter was only the third time in the last three years that volumes had passed the US$100 billion mark.  Compared to Q4 2010, direct investment transactions were down 10 percent in Q4 2011.

“Debt in all its forms, deleveraging, bank stability and currency movements will continue to dominate the economic outlook in 2012 as they did in 2011,” said Arthur de Haast, Head of the International Capital Group at Jones Lang LaSalle.  “Sentiment and economic forecasts in Europe imply that we could be in for a difficult year, although in the Americas, in particular, confidence does seem to be returning on the back of improving economic indicators, while Asia Pacific looks set to continue on its growth path.”

Green-Morgan continued, “In 2011, we recorded a 25 percent increase in transactional activity with the Americas up almost 60 percent and EMEA up 16 percent in US$ terms.  Asia Pacific, despite several natural disasters across the region maintained similar investment levels in 2011 to the strong performance of 2010.”

de Haast concluded, “The on-going deleveraging by the commercial banks will exert positive and negative push and pull factors on the real estate investment market, however, good quality, well-leased commercial buildings in the major cities of the world remain an attractive asset class for many long term investors.”

Jones Lang LaSalle believes that volumes in 2012 will match those of 2011, although downside risks from the Eurozone sovereign debt crisis could have a substantial effect on transactional volumes.

Notes to editors
Table: Global commercial direct real estate investment 2004 – 2011 (US$ billion)
 
 
Jones Lang LaSalle’s Global Capital Flows analysis provides a set of data designed to help investors understand how commercial real estate capital is moving around the world. The findings are released quarterly, first in the transaction volume analysis represented in this release, and secondly in a broader quarterly report which will be issued in the following weeks. All of the current Global Capital Flows data can be found in interactive website which also acts as a portal for media and clients to access Jones Lang LaSalle’s global capital markets research. Bookmark this site for the most up to date global real estate and data at http://www.joneslanglasallesites.com/gcf
  1. Intra-regional: Both purchaser and vendor originate from the region where the asset is located.  For instance, a US REIT purchasing in Canada, or a German Open Ended Fund selling in the UK. 
  2. Inter-regional: Purchaser, vendor or both originate from outside the region where the asset is located. For instance, a US REIT purchasing in Denmark, or an Australian Pension Fund selling in Canada.
  3. Cross-border: Refers to any purchaser, vendor or both that originates from outside the country in which the relevant transaction occurs. Categorised into Inter-regional and Intra-regional transactions.
  4. Domestic: Refers to any investor that originates from within the country in which the relevant transaction occurs. Transactions involving both “domestic” purchaser and seller are referred to as “domestic” activity.
  5. Entity-level transactions, development projects and multi-family residential investment are excluded from our provisional data and may change.
  6. Jones Lang LaSalle converts transaction values into USD at the average daily rate for the quarter in which the transaction occurred. In other words, the foreign exchange effect has not been removed.
  7. Global Funds are funds which raise capital in multiple regions.
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About Jones Lang LaSalle
Jones Lang LaSalle (NYSE:JLL) is a financial and professional services firm specializing in real estate. The firm offers integrated services delivered by expert teams worldwide to clients seeking increased value by owning, occupying or investing in real estate. With 2010 global revenue of more than $2.9 billion, Jones Lang LaSalle serves clients in 70 countries from more than 1,000 locations worldwide, including 200 corporate offices.  The firm is an industry leader in property and corporate facility management services, with a portfolio of approximately 1.8 billion square feet worldwide. LaSalle Investment Management, the company’s investment management business, is one of the world’s largest and most diverse in real estate with $47.9 billion of assets under management. For further information, please visit our website, www.joneslanglasalle.com.