Asia Pacific Property Investment Up 24%

ASIA PACIFIC – Data from Real Capital Analytics (RCA) revealed that purchases of income-producing real estate within the region during the first 11 months of this year hit a record US$167.38 billion. While this translates to a 1.5 percent uptick from the same period in 2019, it represents a year-on-year growth of 24 percent from 2020.

The year-to-date tally is also 16.3 percent higher than the average for the January-November period in the 5 years prior to the COVID-19 pandemic.

Aside from that, the pipeline of pending property investment deals in Asia Pacific as of end-September 2021 surpassed US$68 billion, a two-fold surge from what it was 2 years before.

“We are not just seeing growth over 2020, but also above the long-term average, meaning that 2021 could be a record year and continue the longer-term expansion of the investment market in Asia Pacific,” said David Green-Morgan, Managing Director for Asia Pacific at RCA, a provider of commercial property deal research and analysis.

The company’s head of analytics for Asia, Benjamin Chow highlighted that the growth in the region’s property investment market has been “broad-based and well-distributed across the office, retail, and industrial sectors.”

Looking ahead, 2022, could be a bumper year for the region’s real estate investment market, with Australia, South Korea, and Singapore among the property hotspots attracting huge amounts of capital.

For instance, Cushman & Wakefield (C&W) expects investment volumes next year to be on par with record levels seen in 2019 at approximately US$180 billion.

“On the upside, total volume in APAC may exceed the US$180 billion forecast, should sufficient high-quality assets or large portfolios be brought to market,” noted the property consultancy.

Key drivers for this forecast include the low interest rates, properties being an inflation hedge, an intensified focus on capital deployment by investors, and a record amount of marketable securities that are highly liquid.

“As we move into 2022, competition for real estate deals remains stiff and bids high across the Asia Pacific,” Shirin Tang, Managing Partner at law firm Morrison & Foerster’s Singapore office told The Business Times

Another is the significant amount of capital targeting Asia Pacific real estate, with a large number of major funds reaching final, she added.