Singapore Top Outbound Property Investor From Asia: CBRE
SINGAPORE – Investors based in the city-state spent billions in overseas real estate, making it the biggest outbound property investor from Asia, according to a report published by CBRE on Thursday afternoon (24 March, SGT).
For the whole of 2021, Singapore investors deployed US$32 billion, which represents a whopping 164 percent surge from the preceding year.
In particular, the United States was the top destination for Singaporean capital, with logistics being the most in-demand asset class. Meanwhile, Hong Kong investors ramped up their property purchases as they were named as the 2nd most active source of Asian outbound capital. This group invested US$6.7 billion last year, up 60 percent from 2020.
“Investors from Singapore and Hong Kong were the most active due to the size of their markets and available liquidity. The United States was the preferred international market for Asian investors due to attractive US dollar hedging costs and its robust economy relative to Asia as business travel normalises,” said Greg Hyland, Head of Capital Markets for Asia Pacific at CBRE.
Overall, Asian outbound commercial property investment jumped 69 percent on an annual basis in 2021 to US$54.6 billion, exceeding the pre-pandemic volume in 2019.
The other top destination markets for Asian investors are Australia, mainland China, the UK, and Japan. The UK was the only European market to see a substantial inflow from Asian capital in 2021, with more investors shifting their emphasis back to Asia Pacific, where they can rely on stronger networks and local expertise to execute and evaluate deals.
In 2021, Asian outbound investment in industrial and logistics assets hit US$24 billion, exceeding office investment for the first time and further compressing global industrial yields, which declined to 3.7 percent during the last quarter of 2021.
In comparison, Hong Kong cross-border investors focused on retail and office assets in mainland China, while Korean institutional and real estate investment funds preferred office properties in Australia and the United States.
“The majority of Asian investors are expected to deploy more capital this year with a particular focus on North America and regional gateway markets, such as Tokyo, Shanghai, and Sydney.”
“As a result, we expect cross-border investments to grow by up to 10 percent to US$39 billion in 2022,” forecasted Henry Chin, Global Head of Investor Thought Leadership and Head of Research for Asia Pacific at CBRE.