A new report from Colliers International says that Canadian real estate investors are increasingly looking abroad.

According to the 2014 Global Investor Sentiment report, investors are looking to generate higher returns and diversity risk. The report results from a survey of more than 500 major institutional, REIT and private investors.

Transaction data from Real Capital Analytics shows Canadians are the largest foreign buyers of commercial property in the United States — closed and under-contract transaction volumes have reached $8 billion USD.

Investors are also looking overseas, with Canada becoming the third largest global investor in foreign market, behind only the U.S. and Singapore. However, only 19 per cent of those surveyed are investing offshore, with 81 per cent of respondents saying Canada would continue to be the primary investment destination in 2014.

For 38 per cent of investors, Toronto is the most sought after city, followed by New York and Vancouver with 12 per cent of investors each. Calgary, Munich and London follow at six per cent each.

“Less than half of Canadian investors claimed to have appetite to take greater risk in 2014, which is below the levels their peers in the U.S., the U.K. and Australia expressed,” says David Bowden, president and CEO of Colliers International Canada. “Given that Canada and the U.S. are considered a safe haven, it is natural that local investors gravitate towards these markets.”

The survey also indicated that investors have a strong appetite for real estate in safe haven cities — including mature markets in Western Europe, the U.S. and Canada. Investors are feeling more risk averse, given investment preference with strong economic fundamentals.