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The term international real estate describes a phenomenon that started in the 1980s and kept pace with globalization. The term encompasses real property development, sales and leasing transactions across national borders. International real estate could be viewed as one of the most dynamic branches of real estate although it is, by definition, influenced by fluctuating market value in various sectors between countries, as can be evidenced by the 2007–2008 financial crisis.
International real estate is best subdivided into two categories: international commercial real estate and international residential real estate. Some examples of international real estate transactions are:
Most international commercial real estate transactions take place between corporations and may involve, lead to, or be a consequence of legal, design, urban planning, engineering, financing, and construction work. From a national government perspective, attracting foreign investment into real estate development projects can be a key priority for increasing country revenue and a key strategy for increasing the availability of national infrastructure and amenities. [1]
Some of the factors leading to the growth in the international commercial real estate sector are:
International capital market integration requires institutional help, both through the emergence of investment products catering to international investors, and through reliable information sources that make markets more transparent. The development of public equity and debt real estate market makes it much easier for investors to allocate significant amount of money outside their home market. The overall growth of the global property share market is helped by the proliferation of tax pass-through structures all over the world. The success of the U.S. REIT market has prompted regulators in many countries to introduce similar-but different named structures. REITs are an important development in the internationalization of property markets. [3]
Most international residential real estate transactions are generated by individuals purchasing lots or built units (including family homes, apartments, and condominium units). These purchases form the bulk of what is sometimes referred to as the vacation/second home market or residential tourism market.
If a person wishes to initiate international real estate investment for the individual’s or the institution’s portfolio, the person or financial manager may consider multiple avenues. The indirect method of entering international real estate investment may involve passive investment in securities that are based on international real estate collateral or passive investment in international real estate service firms and offices. The direct method of entering international real estate investment may involve total acquisition or partial acquisition of the foreign property. [4]
For developed countries whose GDP per capita is above threshold level, it is calculate the value of institutional-grade real estate is 45% of national GDP, which is consistent with data gathered. However, to determine the size of institutional-grade real estate markets in developing countries adjustments are made because only the more affluent segments of the population in those countries have the wherewithal to use such real estate. [5]
Some of the factors leading to the growth in the international residential real estate sector are:
In the U.S., the Chinese are now the largest foreign buyers of homes, accounting for $28.6 billion of sales in the 12 months ended March 2015, according to the National Association of Realtors. [6] There are three major reasons why Chinese are investing in the US real estate market: investment diversification, overseas education of their child and immigration. [7]
The Chinese real estate website Juwai.com, part of Juwai IQI, estimates that Chinese real estate holdings abroad totaled $80 billion in 2015 and are expected to balloon to $220 billion by 2020. [8] Chinese investors are interested in commercial projects, residential properties, hotels, golf courses, clubs, land, industrial warehouses, office buildings, and shopping centers. [9] Chinese investors initially were focused mostly on the major gateway cities such as New York City, San Francisco, Los Angeles but are now moving into other cities as well. [10]
A real estate investment trust is a company that owns, and in most cases operates, income-producing real estate. REITs own many types of commercial real estate, including office and apartment buildings, studios, warehouses, hospitals, shopping centers, hotels and commercial forests. Some REITs engage in financing real estate. REITs act as a bridge between the worlds of housing and urban development on one hand, and institutional investors and financial markets on the other. They are typically categorized into commercial REITs (C-REITs) and residential REITs (R-REITs), with the latter focusing on housing assets such as apartments and single-family homes.
David Lichtenstein is an American billionaire, entrepreneur, and real estate investor. He is the founder and CEO of The Lightstone Group, which he founded in 1988.
Real estate investing involves the purchase, management and sale or rental of real estate for profit. Someone who actively or passively invests in real estate is called a real estate entrepreneur or a real estate investor. In contrast, real estate development is building, improving or renovating real estate.
An Australian real estate investment trust (A-REIT) is a unitised portfolio of property assets, often listed on a stock exchange such as the Australian Securities Exchange (ASX). Such investment structures were known as listed property trusts (LPT) in Australia until February 2008, but were renamed to be more consistent with international terms. Unit trusts of property assets which are not listed on a stock exchange are known as unlisted property trusts.
Construction activity has increased due to recent tax incentives. Romania has become an increasingly popular choice for British property investors, according to recent research from Currencies Direct. The latest Global Emerging Markets Index from the foreign exchange company shows that Romania has made the top ten for the first time, reaching number nine. The monthly index is based on the number of foreign exchange transfers undertaken by the firm to emerging market regions for property purchases. According to Currencies Direct, Romania has seen significant increases in house prices in recent years and its interest rate has dropped from a level of 154 per cent in 1997 to 8.9 per cent in 2005.
Private equity real estate is a term used in investment finance to refer to a specific subset of the real estate investment asset class. Private equity real estate refers to one of the four quadrants of the real estate capital markets, which include private equity, private debt, public equity and public debt.
Ever since the 1997 Asian financial crisis, property markets have greatly developed through the years. Asian governments have improved the financial stance associated with the structure of housing finance, allowing more access to a diverse range of mortgages products.
The economy of the People's Republic of China is a developing mixed socialist market economy, incorporating industrial policies and strategic five-year plans. China is the world's second largest economy by nominal GDP, behind the United States, and since 2017 has been the world's largest economy when measured by purchasing power parity (PPP). China accounted for 19% of the global economy in 2022 in PPP terms, and around 18% in nominal terms in 2022. The economy consists of public sector enterprises, state-owned enterprises (SOEs) and mixed-ownership enterprises, as well as a large domestic private sector which contribute approximately 60% of the GDP, 80% of urban employment and 90% of new jobs, the system also consist of a high degree of openness to foreign businesses. According to the annual data of major economic indicators released by the National Bureau of Statistics since 1952, China's GDP grew by an average of 6.17% per year in the 26 years from 1953 to 1978. China implemented economic reform in 1978, and from 1979 to 2023, the country's GDP growth rate grew by an average of 8.93% per year in the 45 years since its implementing economic reform. According to preliminary data released by the authorities, China's GDP in 2023 was CN￥126.06 trillion with a real increase of 5.2% than the last year.
The 2005 Chinese property bubble was a real estate bubble in residential and commercial real estate in China. The New York Times reported that the bubble started to deflate in 2011, while observing increased complaints that members of the middle class were unable to afford homes in large cities. The deflation of the property bubble is seen as one of the primary causes for China's declining economic growth in 2013.
Real estate in China is developed and managed by public, private, and state-owned red chip enterprises.
CapitaLand is a Singaporean real estate investment and management firm. The company holds properties in over 40 countries. It has a stable of six listed real estate investment trusts and business trusts, as well as about 30 private vehicles. It pioneered REITs in Singapore with the listing of CapitaLand Mall Trust in 2002, now merged with CapitaLand Commercial Trust to form CapitaLand Integrated Commercial Trust.
CrossHarbor Capital Partners is an American investment firm, specializing in private equity, based in Boston. CrossHarbor Capital Partners develops and manages private equity investment products in three principal business areas: real assets, distressed securities and mezzanine capital. CrossHarbor has assets under management of $5.5 billion diversified over a half dozen distinct funds. Its client base includes college endowments, state and large organization pension funds and high-net-worth individuals seeking lower fee, high potential opportunities to offset more traditional market investments.
Prologis, Inc. is a real estate investment trust headquartered in San Francisco, California that invests in logistics facilities. The company was formed through the merger of AMB Property Corporation and Prologis in June 2011, which made Prologis the largest industrial real estate company in the world. As of December 2022, the company owned 5,495 buildings comprising about 1.2 billion square feet in 19 countries across North America, Latin America, Europe, and Asia. According to The Economist, its business strategy is focused on warehouses that are located close to huge urban areas where land is scarce. It serves about 6,600 tenants. Prologis began to expand its non-real estate business, Essentials, in 2022, offering customers solar power, racking systems, forklifts, generators, EV charging infrastructure, and other logistics tech equipment for purchase.
Real estate in Pakistan is a growing sector of the economy of Pakistan.
Real estate in Bangladesh refers to the industry and market related to the buying, selling, and development of properties in the country. It is a fastest growing sector in Bangladesh.
Fundrise is a Washington, D.C.-based financial technology company founded in 2010 that operates an online investment platform. Fundrise has been labeled as the first company to successfully crowdfund investment into the real estate market.
The Republic of Panama's real estate industry relies on foreign investment. The sector has grown since 2006, as such investment has helped to fuel Panama's economy and housing market.
Abu Dhabi Financial Group (ADFG) is a global investment management group, headquartered in Abu Dhabi.
Scott Picken is a South African-born real estate investor and entrepreneur. He is the co-founder of Wealth Migrate, a fintech company that offers real estate investments on its online marketplace through crowdfunding. He began working in real estate at the age of 26 when he founded International Property Solutions. The Huffington Post named Wealth Migrate as one of the top 60 real estate crowdfunding solutions in the United States in 2014.
The economy of Delhi is the 12th largest among states and union territories of India. The Nominal GSDP of the NCR was estimated at 272.603 Billion and the Nominal GSDP of the NCT of Delhi for 2023-24 was estimated at ₹11.07 lakh crore (US$130 billion) recording an annual growth of 9.2%. Growth rate in 2014-15 was 9.2%. In 2020-21, the tertiary sector contributed 85% of Delhi's GSDP followed by the secondary and primary sectors at 12% and 3% respectively. The services sector recorded an annual growth of 7.3%. Delhi is the largest commercial centre in northern India. As of 2021, recent estimates of the economy of the urban area of Delhi have ranged from $370 billion and it has $272.603 billion as ranking it either the most or second-most productive metro area of India.
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