Singapore’s GIC Pte Ltd., barred from investing in Singapore itself, bought a half stake in London’s Broadgate office complex last year for more than 1.7 billion pounds ($2.8 billion), a record for a central London property.

In June, Citigroup Inc. paid a record HK$5.4 billion ($697 million) for a Hong Kong office tower that will bring most of its 5,000 employees under one roof. Canada’s Manulife Financial Corp. last year paid HK$4.5 billion for a similar-size tower and development in the city’s Kowloon district.

“Canadians are buying everywhere,” said Ross Moore, director of Canada research at CBRE Group Inc., the biggest commercial broker. “They are shopping the world. What’s happened in the last five to 10 years is the big pension funds pretty well own everything of quality in Canada. They love real estate and have all this money coming in and they have to put it somewhere.”

Toronto-based Brookfield Asset Management Inc. has started investing in European warehouse properties and Indian offices after accumulating the biggest holdings of office buildings in both the U.S. and Canada. The real estate units of Ontario Teachers’ Pension Plan has been investing in Brazil as well as the U.K. and Australia. Canadian Pension Plan Investment Board has bought London residential, retail and office properties.

Easy Targets

Markets such as the U.K. and Australia are easy targets for North American investors, Moore said.

“The ownership structures are familiar, the legal structures are very similar, they understand what they’re getting into and the transparency is good,” he said.

In Japan, where interest rates are near zero thanks to central bank stimulus, investors can borrow cheaply to buy buildings whose rents translate into an investment yield that’s three or more percentage points higher, said Sonny Kalsi, co- founder of GreenOak Real Estate, who previously led Morgan Stanley’s real estate investment unit.

Investment yields on properties are measured in terms of capitalization rate, a building’s net operating income divided by purchase price. A property valued at $100 million with income of $5 million a year would translate to a cap rate of 5 percent.

ETF Gains