Construction spending in 2007 totaled $1.7 trillion

In fact, the U.S. credit crunch and financial meltdown is pushing a growing number of real estate investors to look outside the United States and Europe for opportunities.

According to A.T. Kearney's recent Real Estate Opportunity Index, companies, developers and investors alike have been scouting the world for real estate bargains.

The most popular targets are in an area A.T. Kearney dubbed as CHIMEA - the new economic region stretching from China across India and the Middle East to Africa.

According to the Index, the top 50 emerging markets represented in the report, spent a combined total of $1.7 trillion on construction in 2007, with a five-year CAGR (compound annual growth rate) of up to 6%.

Robert Zielger, Vice President, A.T. Kearney added that international property developers are finding these large and rapidly growing markets too attractive to ignore.

"Developers grow within their local geography until they run out of opportunity or need to diversify their risk profile. For a sustainable business strategy, companies have to expand internationally during the good times to be prepared for the bad".

Focusing on a short list of emerging markets globally, the index weighs real estate development potential based on construction spending and growth as well as a combination of country risk and ease of doing business.

The global real estate industry as a whole is not in the same desperate situation as the US, and is keeping the industry afloat.

China and India are growing at such a rapid rate, that they dominated the index by a vast margin with Thailand in third place.

China's economic boom has created a heated real estate market, driven not only by office, residential and retail demand but also by the 2008 Olympics and the 2010 World Expo.

The opportunity is substantial indeed: China's estimated construction spending for 2007 alone totals more than $500bn.

Saudi Arabia dominated the Middle East sitting in 6th place on the whole list, with the UAE coming second in the region.

Large-scale activity in the Kingdom is driven by increasing funds for mega-scale developments, stemming from its petroleum-based economy.

In addition, public funds are financing schools, hospitals and low cost housing among other infrastructure and social sector projects.

A recent increase in private sector investment has spurred the development of premium office, residential and retail space.

The UAE, one of the most affluent economies in the region and home of its real estate boom, is experiencing both, the advantages and disadvantages of being in the forefront.

Dubai, where the real estate boom originated, is a market waiting for the impact of oversupply, but construction delays may create a soft landing.

Abu Dhabi has also been a real estate star, and now needs to modernize its superstructures and office space.

The Index also notes that investors from CHIMEA have $4.1 trillion to invest, and real estate development remains an attractive destination for capital. Yet strong markets can turn sour quickly.

"Investing in global markets isn't without risk. Investors often have a tough time getting data to assess individual properties and many investors face a myriad of murky tax laws, government regulations and political instability in some regions" added Maktoum Al Maktoum, Associate Director, A.T. Kearney Dubai.

Property developers have long known the need to diversify geographically through a carefully balanced portfolio, while managing the risk of entering unknown markets. A.T. Kearney's report will assist in getting a better picture, globally.