Hong Kong is Asia's second-biggest commercial real estate investment destination

And the tenth in the world.

CBRE has recently published a report showcasing global capital flows to the commercial real estate (CRE) market in H1 2015 and analyzing the key trends in the global market.

According to a release from CBRE, in terms of top destinations for global capital, the report shows that Hong Kong is the second largest CRE investment market in Asia and the tenth in the world, with a value amounting to US$5.5 billion in H1 2015.

China ranks as the third largest Asian destination for global capital, with a transaction value of US$4.0 billion in the first half of 2015.

In H1 2015, Asian investors accounted for nearly 20% of global cross-border investment, or US$19 billion. Of this, China’s outbound capital value was US$6.58 billion - the top among Asian markets. Hong Kong recorded outbound capital of US$2.23 billion.

Here's more from CBRE:

An important shift in real estate since the global financial crisis has been the rise of ’permanent’ capital. Investors such as REITs and sovereign wealth funds do not have to trade assets as they are not subject to short-term return metrics that tend to make traders out of investors in many other asset classes.

In 2014, REITs and SWFs accounted for 32% of international capital flows into US gateway cities, up from 0% in 2009. Frank Chen, Executive Director, Head of CBRE Research, China, commented on the report results, “In recent years, the growing presence of ’permanent’ capital has significantly impacted China’s commercial real estate investment market.

’Permanent’ capital accounted for nearly 25% of major domestic transactions in H1 2015.” The last two years have seen a shift in sector distribution of the global CRE investment market. The dominance of the office sector has been gradually eroding, from 46% of the market in 2007 to just 35% in H1 2015.

As real estate markets continue to develop, in China and in many other Asian countries, further sector-rebalancing is expected in the mid-term, with industrial and hospitality segments poised to gain from the shift, as well as alternatives sectors such as senior housing and healthcare.

Johnny Shao, Executive Director, Head of Investment Properties, CBRE China, commented, “Global CRE investment reached US$407 billion in H1 2015, the strongest first half since H1 2007 (US$442 billion). We forecast that overall global investment activity in the second half of 2015 will continue to grow.

Although China is experiencing weaker inbound investment activity due to a combination of expensive pricing in a global context and the recent economic slowdown, we believe China has the momentum to grow on its long-term road to global expansion. We expect China will benefit from increased investments by long-term asset holders and the development of a more balanced sector mix.”