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Economic Outlook:

The United States economy has experienced a volatile run over the past two years. While the past few months have seen an increase in momentum for the job market, ephemeral economic momentum in 2010 and 2011 has given employers ample reason to hire cautiously in 2012. Consumer activity, which constitutes 70 percent of the domestic economy, has been building slowly – but memories of the 2007-2008 financial crash and the resulting consumer credit issues remain fresh. Compounding all of this economic uncertainty are Federal austerity measures, which are set to be implemented in 2013 as a result of the failed Congressional supercommittee that was charged with trimming the nation's debt. Yet, for all of this uneasiness about the U.S. economy, foreign investment in U.S. commercial real estate remains robust. Why?

By Sandy Paul National Research Director Delta Associates | Updated on December 21, 2012

The United States economy has experienced a volatile run over the past two years. While the past few months have seen an increase in momentum for the job market, ephemeral economic momentum in 2010 and 2011 has given employers ample reason to hire cautiously in 2012. Consumer activity, which constitutes 70 percent of the domestic economy, has been building slowly – but memories of the 2007-2008 financial crash and the resulting consumer credit issues remain fresh. Compounding all of this economic uncertainty are Federal austerity measures, which are set to be implemented in 2013 as a result of the failed Congressional supercommittee that was charged with trimming the nation’s debt. Yet, for all of this uneasiness about the U.S. economy, foreign investment in U.S. commercial real estate remains robust. Why?

At the peak of the market in 2007, foreign buyers spent $25.3 billion snapping up U.S. commercial real estate assets, according to Real Capital Analytics. This represented 6.1 percent of the total sales volume. The net acquisition dollar volume (the amount spent on acquisitions by foreign buyers minus the amount received from sales by foreign sellers) was $8.4 billion.

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