In the fourth quarter, however, the increase was 84 percent over the previous quarter.
According to global property consultant CBRE, global commercial real estate investment surged by 84 percent quarter-over-quarter in Q4 to $290 billion, but was down 20% from Q4 2019. A 97 percent rise in volume in the United States drove the jump between Q3 and Q4 2020. Despite this, the epidemic caused a 26 percent drop in yearly worldwide investment in 2019. property qatar
The potential of vaccine deployment and ongoing economic recovery boosted investor mood in all three global areas, resulting in a large Q4 bounce. Despite a return of COVID infections in some regions of the world, Q4 results point to a bright future in 2021.
The Americas are a continent that spans the globe.
The Americas led the worldwide recovery in Q4, with investment volume more than doubling from Q3 to $144 billion. This was 20% lower than the previous quarter's record-breaking volume and 11% lower than the five-year Q4 average. The reasonably strong conclusion to 2020, on the other hand, reduced a 60 percent year-over-year fall in Q2 and Q3 to a less painful 34 percent yearly decline.
In Q4, the United States recorded $135 billion in transactions, a decrease of 21% year over year but a 97 percent rise over the prior quarter. In Q4, this accounted for 47% of total worldwide volume. The $3.4 billion acquisition of Taubman Centers by Simon Property Group was the only entity-level purchase in the United States since February. Investment fell 34% in the United States, 29% in Canada, 15% in Brazil, and 57% in Mexico throughout the course of the year. The rising number of COVID-19 deaths in Mexico has hampered the country's economic and real estate recovery.
On a sector level, multifamily had a 1% reduction in Q4 investment volume year over year, while industrial saw a 4% reduction. Due to their solid outlooks and proven endurance in the face of pandemic uncertainty, investors continued to flock to America's multifamily and industrial assets. In 2020, 62 percent of America's investment volume was made up of industrial (26 percent) and multifamily (36 percent), compared to 53 percent in 2019. (Figure 2).
The office sector was down 35% year over year in Q4, but up 93% year over year in Q3, which is a promising omen for 2021. Vaccinations and improved mobility are critical to the retail and hotel sectors' recovery. In 2020, the two industries together accounted for 13 percent of total volume, down from 18 percent in 2019.
EMEA (Europe, Middle East, and Africa)
EMEA investment increased by 84 percent from Q3 to $109 billion in Q4, down 25% from Q4 2019 and 12% from the five-year Q4 average. The annual total rose to $329 billion in Q1, a 17 percent decrease from the previous year and the smallest decline of all three areas.
The higher volume in Q4 was primarily due to Germany, the United Kingdom, and the Netherlands. However, year-over-year, Germany's Q4 volume plummeted 30%, the UK's declined 20%, and the Netherlands saw a 10% gain. Denmark, Switzerland, and Norway showed surprising resiliency in 2020, finishing the year with higher volumes than in 2019. Investor mood in early 2021 may be harmed by recent reintroductions of lockdown measures.
Multifamily and industrial assets are becoming increasingly popular in the region. In 2020, they will represent for 38 percent of overall EMEA investment, up from 30% in 2019. (Figure 2). In 2020, multifamily investment increased by 7%, while industrial investment increased by 11%. In these uncertain times, investors accepted low yields in both sectors in exchange for prospective rent increases and low risk.
In Q4, office and retail investment volume increased by 77 percent and 67 percent, respectively, compared to Q3. However, their annual volumes decreased by 34% and 5%, respectively. As employment growth picked up, the Q4 office bounce was particularly noticeable in the United Kingdom and Germany, with a concentration on core assets. The amount of retail investment is projected to remain low. In 2020, the hotel industry was down 66 percent. In 2021, investors expect more distressed sales.
Asia-Pacific (APAC)
The benefits of an efficient pandemic response were once again demonstrated in APAC. In Q4, APAC investment volume climbed by 34% quarter-over-quarter to $36 billion, matching Q4 2019 levels, reflecting the region's steady return to normalcy. The annual volume in APAC decreased by 21% in 2019 compared to the previous year.
As investors returned to gateway office markets such as Tokyo, Hong Kong, Sydney, and Shanghai, Japan, China, and Australia led the Q4 recovery. South Korea, Japan, and Taiwan fared well throughout the year, with yearly changes of +6%, -2 percent, and -6 percent, respectively, thanks to their effective pandemic management. With an annual growth rate of 11% in investment volume, India was a magnet for institutional investors in 2020. India is not only a top outsourcing destination for sophisticated economies, but its rising workforce and burgeoning economy also represent untapped potential. Brookfield paid $2 billion for an Indian office portfolio in Q3, while Blackstone paid $1.2 billion for a retail portfolio in Q4, making it India's largest mall operator.
Despite the impact of remote working, APAC's office demand is likely to stay stable. In Q4, office investment climbed by 27% year over year and was only 9% down year over year, contributing for 57 percent of total APAC investment volume. Logistics properties were in high demand, with volume increasing by 25% in 2020 and their percentage of overall investment increasing to 19% from 12%. (Figure 2). The yield gap between office and logistics assets is closing. In quest of larger profits, some logistics investors are resorting to greenfield projects.
In China and Japan, the retail and hotel industries began to show indications of revival, but lenders remained cautious. Investment in retail and hotel properties declined by 43 percent and 69 percent, respectively. Investors are looking for chances in economies like Japan, Australia, and China, which have huge populations of domestic visitors.
Commercial Investment Forecast for 2021
According to CBRE, most economies' economic forecast for 2021 is good, thanks to flexible monetary policies, more fiscal support, and progress on vaccine deployment. Global CRE investment is likely to normalize in 2021 as the economy improves, particularly in the second half, as people return to the office and travel resumes. According to CBRE, investment volume will increase by 15% to 20% in 2021.