China has an ambitious pipeline for new office construction, but experts say that typically much of it gets delayed.

CHICAGO—With the easing of the financial crisis and its aftershocks, confidence has returned to each of the three major commercial real estate regions. In fact, according to the 40th edition of DTZ’s Money into Property Global 2014 report, invested stock in North America grew by 3%, the first growth seen since 2007. And global stock set a record by hitting $12.9 trillion, up 4% from last year. The big winner was Asia, which grew by 9% in 2013.

“I wouldn’t call this market frothing, but the trend is definitely up in terms of invested stock,” John Wickes, the Chicago-based head of research for the Americas at DTZ, tells

Even Europe, which has struggled to escape the recession’s grip, returned to modest growth after falling 3% in 2012. Invested stock grew 2% to $4.4 trillion. France and Germany and the Nordics grew by between 4% and 5%. Some areas, however, remain under a cloud. The UK declined 6%, partly due to bank deleveraging, and the countries on the continent’s periphery like Spain, Portugal, Italy, Greece and others continued to skid, sinking 9%.

Still, one year ago, many observers feared that some of those peripheral countries would ditch the euro and plunge the continent into chaos. “Much of this risk has dissipated,” Nigel Almond, a London-based director of DTZ and head of strategy research, tells “That’s the big sea change. Just over a year ago there was a lot of uncertainty in Europe, but there has been a massive boost to lender confidence in the last six months.”

The growth in Asia pushed the region past Europe to become the largest region in terms of invested stock. Chinese stock grew 33%, by far the fastest pace of any country, masking slower growth in countries like Australia and Japan. The amount of Chinese debt grew by 30%, much of it from non-bank sources, which has become a concern, DTZ notes.

And China has very ambitious plans for new office space, and many worry these plans will drive up debt even further. But Almond says “we don’t expect all of those projects in the pipeline to come through,” due to project cancellations and delays.

Furthermore, the debt problem “might not be as bad as it seems,” the DTZ study notes, “as the year-end LTV for China stood at 54%. This is well below the average for the US and many European countries.”

As further evidence of a recovery in North America, the region saw for the first time since 2006 an increase in both debt and equity. Debt had lagged for years, but in 2013 it increased by 1% to about $2.5 trillion. Wickes says banks largely drove the increase, mainly because they have now had enough time to deleverage and resolve many of the loans that went sour during the recession.

North American volumes also set a post-crisis record. In 2013, investment hit $235 billion, an increase of 19%. And Wickes has an optimistic outlook on 2014. “The key driver for the US, especially for the office sector, is employment, and the numbers are improving, and that’s noticed by investors,” he says. “It seems that the markets have finally returned to normality.”