Orlando Top U.S. Growth Market for Global Multifamily Investment Capital
According to CBRE's latest U.S. Multifamily Inbound Investment Report for the second half of 2019, Orlando was the highest growth market for global multifamily investment capital, with an annual gain of 231%.
Yet, CBRE further reports that global capital to the U.S. multifamily sector decreased by 27.3% to $10.7 billion in 2019, largely due to a sharp decrease in portfolio deals from an exceptionally high level in 2018.
For single-asset deals--a better measure of investment momentum because of less volatility from year to year--inbound capital increased by 3.8% to $6.1 billion.
Canada, the perennial leader, remained the biggest foreign capital source last year, accounting for more than half of inbound multifamily investment volume. Bahrain, Israel, the Netherlands and the U.K. rounded out the top five, but were distant followers.
Investment managers were the largest buyers, accounting for 33% of global investment in U.S. multifamily assets in 2019. Property companies took a 22% share, while equity funds and institutional investors followed with 20% and 17%, respectively.
While Orlando was the highest growth market for global capital on a percentage basis, by total dollar volume, the top 5 U.S. cities were Washington, D.C. ($780 million), Atlanta ($711 million), Austin ($627 million), Houston ($607 million) and Los Angeles ($591 million).
Global investors have a distinct preference for large assets. Almost half of cross-border capital for U.S. multifamily last year targeted assets priced at more than $200 million.
According to the latest quarterly National Association of Home Builders' Home Building Geography Index, nearly two-thirds of multifamily construction in the fourth quarter of 2019 occurred in "blue counties" where Hillary Clinton garnered the most votes in the 2016 election.
According to the latest National Association of Home Builders/Wells Fargo Housing Market Index, U.S. builder confidence in the market for newly-built single-family homes edged one point lower to 74 in February 2020.
Freddie Mac's latest Primary Mortgage Market Survey is reporting this week that the 30-year fixed-rate mortgage in the U.S. was the lowest in three years. As rates fell for the third consecutive week, markets staged a rebound with increases in manufacturing and service sector activity.
According to new research by Zillow, the total value of every home in the U.S. is $33.6 trillion, nearly as much as the GDP of the two largest global economies combined -- the U.S. ($20.5 trillion) and China ($13.6 trillion).
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