Though global financial turmoil has brought doubt on foreign real estate investment in the United States, 2015 was still a banner year for South Florida.
Foreign investment in the region’s commercial real estate surged to a nine-year high during 2015, according to a new report from commercial brokerage CBRE, but that same windfall likely won’t repeat this year.
The report said foreign investment accounted for roughly $2.6 billion worth of real estate sales in South Florida last year, representing a 65-percent spike in dollar volume from the previous year.
But last year’s investment boon might be short lived. CBRE’s report said foreign dollars flowing into Florida are expected to “moderate” this year compared to 2015.
However, global uncertainty — like Britain’s decision to leave the European Union and food shortages in Venezuela — make the U.S. a comparatively attractive investment, the report said, so foreign sales volume in Florida is still expected to be higher than previous years.
So what are these investors buying here? Last year a huge chunk of the sales went to offices, with roughly $630 million worth of those properties trading hands — the largest of any other asset type.
Retail and hotel buildings are also popular buys, according to the report. The two types combined saw $2.4 billion worth of foreign sales since 2007.
Interestingly, while South Florida — and Miami in particular — are known as investment hubs for Latin American countries, Canadian investors have been the most active recently.
That might be because Canadians prefer Broward and Palm Beach counties for their purchases, at least according to the numbers: they’ve spent roughly $1.2 billion worth of foreign investments in Broward since 2007, marking about half of all foreign purchases. In Palm Beach, they’ve traded $427 million worth of properties, or about 29 percent of all foreign investments since 2007.
“Florida has been an attractive destination for foreign buyers thanks to its high rates of job creation and economic growth,” Quinn Eddins, CBRE Florida’s director of research and analysis, wrote in the report. “And perhaps equally important is the fact that Florida cities, especially Miami and Orlando, have strong global brands and are familiar to investors all over the world.” — Sean Stewart-Muniz