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Why The U.S. Is An Attractive Market For Commercial Real Estate Investors

by Fernando Moore

If you are looking for commercial real estate investors, one area you should search is among foreign real estate investors. International investment is becoming more attractive because governments around the world, including in the U.S., have eased restrictions both on inbound and outbound investments. There are many other reasons why you should look abroad for investors. By knowing specifically why the United States is an attractive market, it will be easier to promote U.S. commercial real estate properties.

It Is Less Expensive To Invest In The United States

The Foreign Investment in Real Properties Act 1980 was created originally to impose large taxes on foreigners who invested in commercial real estate. However, the JOBS Act went a long way toward eliminating the burden that was imposed on foreign investors. The percentage of publicly traded stock that a foreign investor can own before he or she is forced to pay a higher tax has been effectively doubled.

Canada, China, and Australia Are The Top Investors

Chinese investors are one of the largest players in the domestic commercial real estate market. However, the appetite for commercial real estate in the U.S. is not limited to Chinese investors. In fact, the number one foreign source of investors in commercial real estate are Canadian investors. Australia is also a major source of foreign investors.

Many Foreign Investors Lack Other Options

One of the most common reasons for foreign investment into the U.S. market is that there is a lack of commercial investment options for investors in their own countries. Also, there are relaxed restrictions on outbound investments in the United States. The U.S. is seen by foreign investors as a secure and stable place for investment.

A Better Monetary Policy

The United States has low interest rates. This has made it possible for lower finance costs and lower yields in the bond market in comparison.

Europe Is A Major Competitor With The United States

Europe is becoming a more competitive investment option as well because the Eurozone has stabilized. However, Europe's greater competitiveness has not lead to a decrease in the number of foreign investors investing in U.S. real estate. The U.S. population growth is also leading to increased opportunities for investment as infrastructure is upgraded and as more properties are constructed to cater to a growing consumer base. By clarifying the benefits of investing in U.S. commercial real estate when marketing investment products to foreign consumers, you will be able to better attract investors.