Property investors in Latin America are expected to increase their acquisition activity in 2016.

According to CBRE’s recently released Latin America Investor Intentions Survey 2016, the vast majority of real estate investors in Latin America (LATAM) intend to increase their property acquisitions in 2016, with Brazil, the United States, Chile, and Mexico being the top countries on their list.
Highlights for Latin American Property Investors: Brazil, the United States, Chile, and Mexico are among the top investment destinations. The most appealing property types for investment are office and retail. 3 bed apartments for sale

The 2016 survey was conducted between January and early February, at a time when negative sentiment was high due to stock market uncertainty in China. According to the findings, 81 percent of LATAM investors plan to be net buyers in 2016. This percentage is significantly higher than the 65 percent of investors in the Americas who anticipate becoming net buyers.

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“Last year, lower prices for oil, minerals, and other commodity exports weighed heavily on LATAM, but sentiment is improving, and 2016 could be a watershed moment for the country. Investors are interested in the area and see 2016 as a good year to buy, particularly in Brazil, the United States, Chile, Mexico, and Argentina. All of these markets have plenty of Class A/A+ office space, confirming the asset class’s long-term dominance in the area “Guy Ponticiello, CBRE’s Head of Latin America Capital Markets, said as much.
“We should see a rise in acquisitions activity in the long run as current weak economies, such as Brazil’s, regain solid footing and the middle class continues to develop in the leading LATAM countries, resulting in solid gains in real estate demand and more opportunities for investment within the region,” Mr. Ponticiello added.
In 2016, two-thirds of investors cited returns or rental income as their primary reasons for investing in real estate (38 percent and 29 percent, respectively). The remaining third cited more strategic advantages as their key investment reasons, citing favorable expected yields versus other asset classes, real estate’s diversification appeal, and its ability to hedge inflation in approximately equal numbers.
Office remains the most sought-after property sector (35%), confirming the asset class’s long-standing dominance in the area. Investors are also looking for stable income sources and the demand growth potential of a large middle class, so retail (26 percent) is being targeted. Despite the fact that multifamily is a well-established model in Mexico and Brazil, there is a significant interest gap as compared to North America. This suggests that this asset class has untapped potential, especially in terms of diversification. The attractiveness of the hotel industry is close to that of the more developed manufacturing industry. The sector’s investment growth is in line with its attractive return potential.