Foreign Money Is Pouring Into U.S. Real Estate, and It's Not Just Houses

Blockbuster real estate deals are back and breaking records as cash from around the globe pours into U.S. office buildings, apartment complexes and other investment properties.

Commercial real estate transactions jumped 45 percent by dollar volume in the first quarter, an increase driven by sales of multiple buildings or entire companies, according to research firm Real Capital Analytics Inc. Since then, General Electric Co. agreed to sell real estate assets to Blackstone Group LP and Wells Fargo & Co. in a deal valued at about $23 billion, the largest property purchase since the financial crisis.

As the pot of money set aside for U.S. commercial real estate grows, competition for the best properties is pushing investors to buy in bulk. Based on the pipeline, which includes the GE deal, the second quarter may be one of the biggest on record for property transactions, according to Real Capital.

“It’s so hard to get things on a single-asset basis,” said Janice Stanton, an executive managing director at commercial brokerage Cushman & Wakefield Inc. “You’re starting to see larger and larger transactions.”

Real estate deals surged to $129 billion during the three months through March, marking the most active start to a year since 2007, according to Real Capital. The largest was Blackstone’s $8.1 billion sale of IndCor Properties Inc., an owner of industrial buildings, to GIC Pte, Singapore’s sovereign-wealth fund.

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