Investment Intentions Survey 2022

Investors and funds of funds plan to invest at least €67.5 billion* into global real estate in 2022, according to the ANREV/INREV/PREA Investment Intentions Survey 2022. With the current average global real estate allocation at 8.9% and the average target allocation at 10.1%, this affirms that more institutional capital will flow towards the asset class.

As was the case last year, the COVID-19 pandemic had some impact on investment plans. Another issue at the top of investors’ minds is the ESG agenda and most investors consider non-listed funds’ ESG characteristics before investing. Globally, 68% of the surveyed investors consider a Net Zero Carbon commitment to be an important feature when investing in a non-listed real estate fund. 

European highlights:

• A minimum of €67.5 billion* is expected to be invested into global real estate in 2022, of which €60.1 billion* comes from institutional investors and €7.4 billion* from funds of funds
• Despite the current environment and inflationary pressure, inflation hedge remains the least important reason to invest in real estate 
• Investors targeting Europe exhibit an increased preference for value added strategies at 57%, the highest level since 2008
• Non-listed real estate funds remain the preferred access route to the European market for institutional investors while larger investors favour joint ventures and club deals
• European investors became more diverse in their geographical preference across Europe, with second-tier countries scoring higher
• Industrial/logistics was the top single sector choice for the first time since the start of the survey in 2005

*Correction notice 25 Jan: Since publication, this figure has been changed. 

National insights:

Germany:

• After being the most preferred country in Europe for three years in a row, Germany slid into second place in 2022, trailing France by a margin of 3%.
• Germany industrial//logistics remains popular as it is included in the top-3 for the third consecutive year, underpinned by exceptionally strong 12-month rolling asset level return of 28.09% in Q3 2021.

   

France

• France overtook Germany as the most preferred location in Europe for investors to deploy capital in 2022.
• The top ten preferred country/sector combinations feature France industrial/logistics, France office and France residential
   

United Kingdom

• The UK is firmly in the third place when it comes to preferred investment locations in Europe, mainly driven by relatively high interest from non-European investors. It indicates that the UK, despite Brexit, is still considered a top investment market internationally.
• For country/sector combinations, the UK office market ties in a shared first place this year. European investors assign the highest preference to this combination, where interest from non-European investors is on par across the country’s office, residential and industrial/logistics market.
   

The Netherlands

• Despite growing interest in the Dutch market by investors, it was overtaken by Spain this year and slid into fifth place for the most preferred country destinations.
• The Dutch industrial/logistics and residential market fell just outside the top ten most preferred country/sector combinations, placed 12^th and 15^th, respectively.
   

Southern Europe

• Momentum for Spain (4^th) and Italy (7^th) increased in the past years, with investors indicating 62% preference for Spain and 45% for Italy, in 2022. These are well above their long term averages of 40% and 34%, respectively, and demonstrate investors’ increased interest in second-tier markets, in line with higher risk appetite.
• When breaking down preferences by investor domicile, Spain and Italy are the only two countries where interest is on par between European and non-European investors.
   

The Nordics

• In line with the broader shift towards second-tier markets in Europe, interest in Denmark (6^th), Finland (8^th) and Norway (10^th) increased compared to previous years. For Sweden (9^th), appetite is lower than it was last year, though still above its long term average.
• Demand for the Nordics region stems mainly from European investors, with preferences significantly higher than their non-European counterparts.

Download the full report, snapshot and infographic below.