Real estate investment drops 25% in first half of 2021 as supply shrinks

The total volume of commercial real estate investment across greater Tokyo in the first half of 2021 fell 25% from the same time last year as fewer deals were made available.

According to Jones Lang LaSalle, the total sales volume was 11.2 billion USD (approx. 1.23 trillion Yen), putting Tokyo in 4th spot on the international city ranking list. 

The appetite for real estate in the capital has not weakened, but the supply of large-scale buildings for purchase has tightened. There are also cases of corporations selling off their prime assets quietly and behind closed doors, leaving out international institutional investors.

Nationwide, the total transaction volume dropped 29% from the first half of 2020 to 1.8472 trillion Yen. Acquisitions by foreign funds dropped 58% to 392.3 billion Yen. Total expected sales for 2021 are expected to reach 4.3 trillion Yen, down 6% from 2020.

JLL’s reporting covers transactions of offices, hotels, logistics and other commercial real estate. In top spot worldwide was Los Angeles with 12.3 billion USD in transactions. London was in second spot with 11.9 billion USD, and Dallas-Fort Worth was in third spot with 11.6 billion USD.

Source: The Nikkei Shimbun, August 27, 2021.

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