Skyscrapers and people reflected in a puddle of water at the Bund in Shanghai, June 21, 2016. [Photo/VCG]

Shanghai replaced Tokyo as the most attractive destination for property investment in Asia in the fourth quarter of last year, according to the statistics from JLL, a professional services and investment management firm offering specialized real estate services.

Globally, Shanghai was the fifth destination for property investment, after New York, London, Los Angeles and Paris, last year.

According to JLL, the strong performance of the property market in Shanghai was driven by large transactions including ARA Asset Management's $2.91 billion investment in the Century Link complex last October. It was also the biggest single-asset property transaction in the Asia-Pacific region in 2016.

In the retail sector of the property market, the largest transaction in 2016 was Chongbang Real Estate Development's $825 million buyback of 80 percent equity stake in Shanghai's Jinqiao Life Hub.

"Domestic capital was the main driver of real estate transaction volumes in 2016, with domestic investors often outbidding foreign investors in many transactions. We believe that China - particularly Tier 1 cities - remains attractive to foreign investors as the market matures," said Zhou Zhifeng, JLL's head of research for China.

According to data from JLL, the total volume of real estate transactions in Asia-Pacific region in the fourth quarter increased by 21 percent year-on-year in 2016, while the total volumes of real estate transaction increased by 5 percent year-on-year in 2016. The total volume of property transactions in the fourth quarter was $15.5 billion in China, surpassing $7.4 billion in South Korea and $7.2 billion in Japan.