Gulf investors spending more on US property

Dubai

PERSIAN Gulf investors from sovereign wealth funds to rich individuals increased spending on US real estate, attracted by the pace of economic growth, a survey by Jones Lang LaSalle Inc has showed.

Gulf Cooperation Council countries invested US$1 billion in US property this year, a 51 per cent gain over the year-earlier period, according to the survey released in Dubai on Tuesday.

"It's about grabbing a share of the American economy, which has been recovering consistently and effectively since 2011," said Fadi Moussalli, Jones Lang's regional director for the Middle East and North Africa. Investors see the US as being "somewhere in the middle of the recovery cycle" .

Wealth funds and institutional investors are spending more on real estate to diversify their holdings, Jones Lang said. The US economic recovery is attracting the attention of GCC investors who are traditionally more accustomed to London and the rest of Europe.

Texas, California, Washington and Massachusetts have attracted the majority of property transactions completed this year, according to Moussalli. Gulf investors favour multi-family homes and residential compounds where they can improve yields before selling the assets, Mr Moussalli said.

The US economy expanded at a 3.5 per cent annualised rate in the three months through September, following a 4.6 per cent gain in the previous quarter. That's the best back-to-back increase for US gross domestic product since 2003.

"All indicators of the US economy are green and that makes it appealing," Mr Moussalli said. BLOOMBERG