Global office investment surges.

Commercial real estate investment has surged over the last five years, including $500 billion in transactions in North America and Europe combined, according to "Who's Buying the World," an analysis of changing trends in global Class A office ownership recently released by CB Richard Ellis.

"Commercial real estate has become a major global asset class, with virtually every region in the world experiencing an unprecedented level of activity," said Steven Dunn, CBRE's Chief of Global Research Publications.

"We're seeing an incredible variety of investor types across the globe, from J-REITs to pension funds, who have discovered that commercial real estate presents a flexible and attractive trading opportunity."

A key attribute of the diversity of commercial real estate investors is the expanded volume of cross-border transactions, in a survey of 11 major real estate markets in Europe, North America and Asia Pacific, eight showed significant increases in cross-border investment since 2001, further reflecting the increasingly global nature of office building investment.

"With expanded market knowledge, booming commercial development, improved transparency and the availability of almost instantaneous information, the majority of global office markets have experienced robust cross-border investment, and this trend will only continue to grow," Dunn added. While foreign investment was a driving factor around the globe, activity in six of the 11 markets was also underscored by an increase in Real Estate Investment Trust (REIT) ownership.

"Who's Buying the World" explores the changing trends in Class A ownership in the major global markets during the current investment cycle, which began in 2001. Below are a few of the report's other key findings:

* In 2005, office investment sales reached a record $100 billion in the United States.

* Middle Eastern investors were extremely active purchasers in both the United Kingdom and France in 2005, spending more than 1.5 billion [pounds sterling] (US$2.5 billion) and

* 560 million (US$666 million), respectively.

* Spain was one of the few markets with minimal foreign investment, as the Central Madrid market was mostly dominated by local buyers.

* In Sydney, REITs accounted for a majority of activity, with more than AUD$4 billion (US$2.9 billion) worth of transactions.

* At an estimated ownership increase of 32%, REITs represented the most significant change in Class A office investment in Singapore.

* Hong Kong also experienced a noteworthy change, as REITs and foreign investors--who were nonexistent owners of Class A office space five years ago--today each account for 3.0% of the market.

* Since September 2001, Japan has seen the listing of 26 J-REITs with a combined market capitalization of JPY2.6 trillion (US$22.1 billion).