It looks like the Big Apple may be turning green with envy as the Emerald City has edged ahead when it comes to foreign investment in commercial real estate.
A new report reveals that Seattle has passed Manhattan as the top market for CRE acquisitions from overseas investors. In the past year Seattle pulled in $2.5 billion and Manhattan received $2 billion from foreign investors. Both markets experienced a dip in foreign investment during the pandemic, but while Manhattan’s activity dropped by 79% through the first quarter of 2021, Seattle’s fell by only 11%.
Seattle saw most of its foreign investment come from Canada, followed by Asia and Europe. In Manhattan, most cross-border land acquisitions come from Asia, with a larger share of European investors than Seattle.
Part of Seattle’s appeal to Canadian investors comes from its strong tech hub, with companies like Amazon, Facebook, Netflix and Google offering opportunities for commercial investment. These companies have existing leases in the area and represent guaranteed income to real estate investors, as well as global appeal.
The uncertainty of the pandemic did cause foreign investment to slow in both Seattle and Manhattan. The switch to remote work for many companies, and uncertainties about existing leases and rent caused many international investors to slow their spending until things were more concrete.
With the pandemic finally moving to the rearview for the U.S., it seems likely that an uptick in foreign investment is around the corner as companies and investors alike prepare for a return to business-as-usual.
This article was originally posted on Commercial Observer by Celia Young.