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Global Real Estate Investment Market Size Grows Significantly in 2017MSCI Inc. (NYSE: MSCI), a leading provider of indexes and portfolio construction and risk management tools and services for global investors, today released the annual MSCI Real Estate Market Size Report which estimates the size of the professionally managed global real estate investment market. The findings show the market grew by 15 percent, from $7.4 trillion in 2016 to $8.5 trillion in 2017. The report details notable changes to the size of 25 markets across the globe, as contained in MSCI's IPD Global Annual Property Index, as well as seven other countries that form part of MSCI's IPD Pan-Asia Annual Property Index. Among the constituents of the Index, the following important market size estimates were reported. Noteworthy Country Market Size Estimates
Drivers of Market Size Changes in 2017 Currency movement was a big driver of market size, effectively increasing the global real estate investment market by approximately 5.3 percent in USD, in contrast to their negative impact in 2016 (-2.3 percent). Capital value growth and new developments in the market, such as new construction and sale and leaseback transactions, also contributed to the growth in market size. "While currency fluctuations have undoubtedly impacted relative weights of countries within the Index over time, capital value growth has also been a long-term feature driving the shape of the market today and many countries showed positive capital value growth in their local currency in 2017," said McNamara. "Additionally, it is important to remember the impact that the global financial crisis had on the landscape we see today. Both the U.K. and the U.S. suffered from substantial negative capital growth. Currently, the absolute market sizes of these two countries has increased by 40 percent and 70 percent, respectively, from their lowest levels recorded during 2008 and 2009," added McNamara. "This has not been the case in all markets globally. Japan's market size, for example, is still below its 2009 level despite rising in each of the past three years." For more information about the MSCI Real Estate Market Size Report, visit www.msci.com/market-size. About MSCI For more than 40 years, MSCI's research-based indexes and analytics have helped the world's leading investors build and manage better portfolios. Clients rely on our offerings for deeper insights into the drivers of performance and risk in their portfolios, broad asset class coverage and innovative research. Our line of products and services includes indexes, analytical models, data, real estate benchmarks and ESG research. MSCI serves 99 of the top 100 largest money managers, according to the most recent P&I ranking. For more information, visit us at www.msci.com.
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