News release

Real estate investment across EMEA rises to over €68 billion in Q3 2021

Living becomes most liquid asset class in the world, accounting for 26% of EMEA investment volumes

November 09, 2021

Iva Kodjabacheva

+34 667949442

London, 9 November 2021 – Global real estate transaction volumes in Q3 2021 reached US$292 billion, up 77% from last year. In EMEA, investment volumes surged to over €68 billion, up 26% y-o-y with year-to-date volumes at €191 billion. This signifies a strong third quarter that’s in-line with the five-year average, showing market recovery from a turbulent pandemic recovery. Industrial & Logistics and Multifamily exhibited strong growth in Q3 across EMEA, with volumes up 59% and 31% respectively.

According to the recently published JLL (NYSE: JLL) Global Real Estate Perspective, a combination of robust deployment and competition for high-quality core and core-plus assets in the quarter allowed year-to-date volumes to reach all-time highs, at US$757 billion (up 50% year-over-year) globally. In the EMEA region, Germany was the key driver for performance, with year-to-date volumes showing a rise of 22% year-on-year to €50bn, closely followed by the UK, which recorded volumes of €48bn.

Adam Challis, Executive Director, Research and Strategy, EMEA, JLL, said: “It’s been an impressive quarter for commercial real estate, with recovery from the pandemic in full swing. Those sectors that remained resilient throughout the last year saw increased investment allocation and have experienced strong growth, whilst those who experienced uncertainty are also now becoming attractive again.

We expect Germany, UK and France to perform well, which they did throughout the quarter, but we’re also seeing new highs from Sweden, Ireland, Poland and Italy, which will attract some of the well-established investors to newer markets throughout the remainder of the year.”

In the third quarter, investor focus on portfolio diversification remained pronounced, with an intense appetite for gaining exposure to sectors benefitting from demographic tailwinds and resilient end-user demand, including the living and logistics sectors. In parallel, conviction is building for lagging sectors in the current recovery, including retail and office sectors.

According to JLL analysis, living has seen US$219 billion of investment year-to-date, an 80% increase over 2020 levels and 36% over 2019. The sector is now the most active globally, ahead of offices, and is driving 29% of transactional activity year-to-date. Activity has largely been concentrated in the U.S. (representing 72% of global living investment in 2021), but global volumes are increasingly supported by growing living investment across Germany, the UK and France. Japan continues to see strong interest from cross-border capital with international buyers representing more than 30% of living investment year-to-date.

The industrial and logistics sector remains similarly liquid, with year-to-date investment gains of 78% year-on-year. Volumes for large ticket deals, those valued at or above US$500 million, reached more than US$13 billion year-to-date at the conclusion of the third quarter.

Total retail investment is now up 35% year-to-date (up from 31% as of H1 2021), and office activity is now up 27% year-to-date (up from 9% as of H1 2021). Sentiment by retail asset type varies widely, but capital deployment is now expanding beyond necessity retail and lifestyle or entertainment-oriented centers, the most resilient retail assets thus far in the recovery. Capital is similarly rotating back into offices, with high-quality assets benefitting most.

Challis adds: “Despite the receding market uncertainty, there is no shortage of capital and we’re seeing real innovation in how it is being allocated towards real estate, with a rise of joint ventures and M&A activity. The potent mix of suppressed M&A activity last year and abundant dry powder is beginning to spark an extended period of deal making and M&A activity, which is something we should look out for during the next quarter and going into next year.”

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About JLL

JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. JLL shapes the future of real estate for a better world by using the most advanced technology to create rewarding opportunities, amazing spaces and sustainable real estate solutions for our clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of $16.6 billion in 2020, operations in over 80 countries and a global workforce of more than 95,000 as of September 30, 2021. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit jll.com.