Global commercial real estate investment dropped during the first quarter, due to the business downturn related to the COVID-19 pandemic, with the Asia-Pacific region showing the largest decline, according to a report by global real estate company JLL.

Global real estate investment was $200 billion for the quarter, down 5% when compared to the same period in 2019, showing the "abrupt and widespread impact" the coronavirus crisis has had on financial markets. It is the first quarter of contraction in 11 years.

Sean Coghlan, head of global capital markets research at JLL, said in prepared remarks that as credit and equity markets felt the impact of the economic downturn during the quarter,  REITs were the first in the real estate industry to feel the impact.

JLL reports that total returns during the first quarter fell 31% on average across eight of the world's largest REIT markets.

The decline in direct real estate investment correlates to the spread of COVID-19, For example, investment in Asia Pacific, where the COVID-19 crisis hit first, was $34 billion during the first quarter, a 26% decline when compared with the prior year.

It took time for the impact to be felt elsewhere, Coghlan suggests, noting that investment in the Americas fell 2%, but it increased by 5%, to $67 billion, in the region including Europe, the  Middle East and Africa.

Some lenders have put a "pause" on investments, he wrote, due to volatility in credit markets and central bank intervention.

"Despite ample liquidity in debt markets, lenders remain in a phase of 'price discovery' and are focused on asset managing their existing portfolios. This has led to a greater scrutiny over leverage, and a focus on experienced sponsors, resilient sectors and strong locations in quoting new deals," Coghlan wrote.

In the current environment, investors are taking defensive steps and some sectors are benefiting, Coghlan said in the press release.

For instance, Coghlan wrote that industrial, multifamily and data center assets benefit from these income stability, occupation density and operating as a critical function.

Also, JLL reports, investment in global industrial markets improved by 7% during the first quarter, with investors taking advantage of the effects of e-commerce. That area had been one off the strongest sectors in real estate before the pandemic.

The world's overwhelmed supply chain may also lead to more demand for manufacturing plants, and delivery and fulfillment centers, JLL suggests.

The multifamily sector, which posted a 1% decline in investment during the first quarter, may nevertheless  benefit in the short term. According to JLL, investment in the global multifamily sector has increased 15.6% each year since 2010.

"As more people move towards cities and space and affordability become an issue, demand for purpose-built rented accommodation is growing," Coghlan wrote.