Colliers reported that about 80 percent of buyers were based on the Mainland, and mostly represented by real estate investment trusts, as well as pools of individual investors known as tenant-in-common purchasers.

The demand for Hawai'i property is being driven by low interest rates, the state's strong economy and a shortage of investment opportunities elsewhere. Such strong demand also has driven returns to extremely low levels, Colliers said.

"Mainland investors are demonstrating a growing appetite for Hawai'i commercial real estate and they continue to scour the state for likely investment targets," said Mike Hamasu, research and consulting director for Colliers.

Colliers also conducted an informal survey of bankers, appraisers and other real estate professionals about the possibility of a real estate bubble resulting from the heavy demand for real estate.

Hamasu said the consensus of industry experts was that the investment activity will continue to be strong for the next year or two, and noted that the market remains grounded on realistic expectations and is not in the midst of a bubble that could lead to a dramatic fall in property values.

Last year, resort property accounted for the most sales, totaling $1.9 billion with such transactions as the Fairmont Kea Lani, Grand Wailea and Four Seasons Wailea. Land transactions totaled about $500 million, followed by retail property at more than $400 million.