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Middle East set to drive global property market


Already one of the world's most crucial commercial hubs, the Middle East is set to contribute significantly to the global real estate market over the following years.

This is the key finding from recent analysis by CBRE, which revealed that investors from the region will contribute around US$15 billion a year into various property markets around the world. This will build on the US$14 billion that Middle East investors spent outside their home market last year.

As such, the Middle East will cement its status as one of the "most important sources of cross-regional capital" in this sector, CBRE says.

In terms of the individual countries leading the expenditure, Qatar emerged as the biggest spender, with outbound investment activity from the country totalling US$4.9 billion in 2014. Following not too far behind was Saudi Arabia, which contributed a total of US$2.3 and was also earmarked as one of the fastest growing investors.

One of the most important insights from the research was that Middle East investors are increasingly shifting their sights to the lucrative US market. Spencer Levy, CBRE's Americas head of research, expects this trend will gain momentum in the years to come.

"While not back to the peak levels of the pre-global financial crisis, Middle Eastern capital flows into the US continue to be strong, growing and diversifying in nature," he explained.

"As the big sovereigns continue to seek safe havens and long-term stable growth potential, the flow of capital from the Middle East will become even stronger. We expect a greater amount of this capital to start looking beyond the gateway markets to achieve its objectives."

Wider economic factors such as struggling oil prices have also prompted investors in the region to rethink their investment strategies and broaden their horizons, according to CBRE. 

Date Published: 17 Aug 2015
Category: General News

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