JLL: More US Investment, Fewer Big Trades

CHICAGO-Direct real estate investment rose 32% to $170.7 billion in the Americas in the first half of 2007, compared to the same period in 2006, according to a Jones Lang LaSalle mid-year capital flow report released recently. The company says that total investment reached $382 billion in the first half of the year, and is on track to hit $700 billion for all of 2007, despite higher interest rates and an expected slowdown of large portfolio trades.

Steve Collins, managing director of the company’s International Capital Group, tells GlobeSt.com that real estate still is enjoying a good chunk of investor interest from a capital shift from stocks and other securities early in the decade. “In spite of interest rates, people are still flocking to real estate as a safe haven,” he says. “It has dropped slightly; where you would have just had 15-20 offers on a class A or trophy asset, you still see 10-12, and you’re seeing quality buyers. Some of the value-added or high-octane money is standing on the sidelines until interest rates correct themselves, but people who see treasury investment as a good bet are also still willing to take the risk on solid return, and a potential upside, from real estate.’