CHICAGO-DTZ Research has released its 39^th edition of Money into Property. The report that analyzes the size and structure of global commercial real estate investment markets, as well as investor and lender sentiment. 

The year-over- year changes were substantial: following growth of 8% in 2011, invested stock grew by a more modest 1.5% in 2012 to reach a record level of USD12.4tn. Asia Pacific was the only region to post growth in 2012 as its invested stock grew 8% to USD4.2tn.—the region is now close to surpassing Europe to become the region with the largest stock. In North America, stock fell by 0.5% driven by a fall in the US stock. Following growth in 2011 the stock in Europe fell 2.6% to USD4.4tn.

Despite low global growth, the focus on further downside potential has receded over the last year. The macro outlook is more balanced and the recovery is expected to continue.  North American invested stock edged down by 0.5% despite 8% growth in both Canada and Mexico. The fall in North American stock has been driven by further deleveraging in the US. The value of outstanding debt in the US fell 2.5% in 2012, which more than offset increases in equity holdings. But, the repercussions of this will be less severe than in Europe.

From their Lender and Investor Survey, DTZ Research maintains that global property market sentiment remains mixed, despite the improving macro outlook. Lenders are more cautious than investors in their annual survey. Most investors feel buying opportunities have returned to normal and that debt availability has improved. DTZ Research believes sentiment has been slow to improve due to inflated expectations. But, despite this, things are not as bad as they seem, considering:

• North American investment volumes were up 15% in 2012, the strongest of any region. Cross-border volumes have returned to their 2005 level. Volumes might be restricted going forward due to lack of sellers.
• All US markets are classified as attractive or very attractive, ahead of Europe and Asia Pacific. In fact, relative value is at the best level in six years, due to lower bond yields and better growth outlook.

North American liquidity tops all other regions. With relative value abundant globally, DTZ Research thinks investors will look at liquidity more closely. North American markets will be a net beneficiary of this in the future

John Wickes is head of DTZ Research for the Americas. The views expressed in this column are the author's own.