Over the past three years, Los Angeles has led the world in commercial real estate transactions despite a global spending slowdown.
More than $96 billion in commercial real estate transactions worth $5 million or more took place in Los Angeles between 2021 and last year, excluding land and entity-level transactions, CoStar News reported, citing a global study by JLL.
Los Angeles topped the list, followed by Dallas with $91.2 billion, New York with $80.7 billion, and London with $77.9 billion.
Paris ranked sixth and Phoenix seventh, according to JLL's Global Real Estate Outlook report.
“These cities have emerged as the world's top markets for direct investment, attracting significant amounts of investment due to factors such as thriving industries, strategic locations, favorable business environments and economic growth,” JLL said in an email to CoStar News.
It's not clear whether JLL defines Los Angeles as a city, county or metropolitan area that extends into the Inland Empire, a growing hub for logistics warehouses.
Global commercial real estate transactions totaled $594 billion last year, down 44% from 2022 and the lowest direct investment figure in more than a decade, including cross-border transactions, according to JLL.
JLL said rising interest rates and capital costs had created a gap between what property sellers were asking and what buyers were willing to pay, causing a decline in global commercial spending.
At the same time, fundraising for closed-end funds buying real estate fell to $142 billion, down 28% from 2022, the brokerage said.
The Chicago-based firm said market conditions have stabilized this year and some real estate sectors have shown strength.
The report said “prices and liquidity for office assets are under pressure amid weak global investor and lender sentiment,” but interest in logistics, residential and some alternative growth sectors remains strong.
JLL will be discussing cross-border investment on a panel at Mipim, the world's largest annual real estate event, taking place in France this week.
Dana Bartholomew