A woman stands in a commercial building with walls of glass windows looking out to trees neighboring the building.

As the commercial real estate market posted a strong rebound in 2021, so did foreign investors flooding back into the sector. Foreign investors purchased an estimated $57.7 billion in U.S. commercial real estate in 2021, a nearly 50% jump from 2020, according to the National Association of REALTORS®’ 2022 Commercial Real Estate International Business Trends Report.

That brings the flow of capital back closer to prepandemic levels. Foreign institutional investors, who are either professionals, pensions, sovereign funds, banks, or insurance companies, fueled commercial real estate acquisitions last year, Real Capital Analytics reports.

Investors targeted secondary markets such as Seattle, Atlanta, and Dallas, which outranked Manhattan in 2021 as the top destinations of foreign investors, NAR reports. The largest amount of capital flowing in came from Canada, followed by Singapore and South Korea.

NAR commercial members report that one of the main draws of the U.S. commercial market is that it is viewed as a “safe and stable place to do business,” Gay Cororaton, NAR’s research economist, writes on NAR’s Economists’ Outlook blog. “It is experiencing strong demand and growth, and cap rates are better than in other markets. There’s available inventory and opportunity in commercial properties, like turning around Class-B retail centers.”

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