Commercial real estate investment has seen a great increase in activity within the last few years. Our city of Boston is actually one of the localities that is benefiting the most from this commercial real estate boom. Safe core cities worldwide are being targeted by major firms for investment opportunities. Moreover, the recent economic downturn has forced the hand of these corporations towards less risky cities that in the past have had sustained economic success. This flight to quality that firms are going through creates a separation between the less risk-averse cities in the Western World and the ones elsewhere which are striving to keep up.
According to the study enacted by Cushman & Wakefield, cities like Boston are regaining the attention of investors and have shown that prices are rising for commercial purchase. This is because there is becoming a shortage of desirable areas to build on whilst these companies nonetheless are still wishing to be close to these proven metropolitan hubs. The dominant cities of the future have resources and land that will soon be needed, thus they attempting to continuously modernize themselves with the hopes that they too will garner the trust of the high-ranking officials in the commercial world. This flight to quality for firms creates a polarization between the less risk-averse cities that today are reaping the benefits of societys current economic trepidations and the cities abroad which are striving to keep up.
When confidence about the worlds economic outlook improves, the worlds developing countries as a whole will reap the sudden vast inflow of dollars that the majority of the United States is now experiencing. Many cities in Asia are realizing a steady increase in investment, with 8 of the worlds top 20 markets being from the continent this year, compared to just 3 five years ago. It is interesting to note that just 7 places in North America are apart of the top markets for this year. Moreover, North America represents the leader in all sectors of commercial investment apart from the purchase of vacant sites where future developments for commercial activity are planned. The aforementioned sector is led by Asia, and much of this can explain its market share increase.
The overall report from Cushman & Wakefield shows that the fastest growing city due to commercial real estate activity is Chicago, with New York in second and Boston in third on a given list of 26 notable investment cities worldwide. What this all boils down to is that in todays uneasy economic climate we find ourselves reverting back to markets in which we find the most comfort and protection. With all of the overseas capital flowing into our given cities, there is no better time to invest in real estate than now. This is certainly an exciting time for Boston and the few other cities who are growing along side us at such a fast rate.
For further information on this study and the other sectors discussed in further detail refer to Boston SF.