Survey: New Contender for Global CRE Rankings
Moscow has debuted on Jones Lang LaSalle’s most recent list of the top 10 cities for real estate investment. The Russian capital saw a total of $3 billion injected into properties in the last three months of 2012, the survey noted, which tied it for eighth place, with Washington, D.C.
While New York remained the top city on the list, the U.S. metropolis was closely followed by London, with $8.8 billion worth of investments. The quarterly ranking also includes Paris ($5.6 billion), Seoul ($4.7 billion), Seattle ($4 billion), Hong Kong ($3.2 billion), and Los Angeles, which was in 10th place, with $2.8 billion of investment. Among the transactions that contributed to Moscow’s performance in the fourth quarter was the purchase of the White Square office complex by O1 Properties for $1 billion in December, in what became Russia’s largest ever office deal.
Russian real estate experts predict that investors are likely to remain committed to the Russian market, with a growing number of them expected to come from abroad—but their interest could be at odds with the number of attractive options to invest in. Prime quality offices, for example, account for just 10 percent of the 2.5 million square meters of Class A properties currently available in Moscow. But the retail segment has more potential for growth, since investors are likely to be attracted to high-quality shopping centers that will soon be completed there.
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