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CBRE Global Capital Value Index Strengthened in Q2 2011
LOS ANGELES -— The CBRE Global Capital Value Index posted a year over year increase of 15.2% during the second quarter (Q2) of 2011, lifted by especially strong capital value growth in Asia Pacific, which rose 24.2% year over year.
“Investor preference gravitated toward prime markets and core assets during the second quarter, fueling value growth in the CBRE Office Value Index,” said Dr. Raymond Torto, CBRE’s Global Chief Economist. “In contrast, secondary and tertiary market capital value growth globally remains subdued. While this strong showing in commercial real estate coincided with economic headwinds in the first half, the increased uncertainty in the global economy makes it unlikely that the performance of the first half of 2011 will continue for the second half.”
The CBRE Global Capital Value Index, which will be published in the Company’s latest Global Capital MarketView, shows that commercial real estate capital markets were active and gradually improving during Q2 2011 despite sustained economic headwinds. The upturn in capital values continued to be led by the recovery in the Asia Pacific. Australia emerged as a key destination for cross-border investment flows in Asia Pacific due to not only high yields, but also as a result of the Japan earthquake which muted transaction activity there and transferred investor interest to Australia.
The CBRE Americas Capital Value Index witnessed its largest gain of 12.7% year over year during Q2 2011 and the America’s index was the last global region to emerge into positive value growth following the financial crisis. While the CBRE EMEA Capital Value index turned positive one quarter earlier than the U.S., it decelerated in Q2 2011, gaining only 8.6% year over year, down from a 11.3% year over year gain in Q1 2011. Growth in EMEA has been affected by the European Sovereign Debt crisis.
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