Real estate investment in Asia looking up

Asia’s property investment recovered significantly in the second half of 2010, with China, Hong Kong, Japan and Singapore the most active markets, according to CB Richard Ellis’ (CBRE) Asia Investment Market report for H2 2010.

Together, the four markets comprised over US$29 billion of transactions from July to December 2010, or 83 percent of the total regional volume.

However, investment activity slowed down slightly in Q4, with the total transaction volume dropping marginally to US$16.5 billion, from US$18.5 billion in Q3.

The Asian property investment market, on the other hand, saw a 59 percent year-on-year increase, with total transaction volume of US$62 billion.

Property investment activity saw a decline in most locations in Q4, excluding China, Malaysia and Singapore, all of which recorded positive quarter-on-quarter increases in transaction volume by 60, 53 and 31 percent, respectively. Singapore saw a record quarterly investment volume of more than US$5 billion in Q4, making up 31 percent of the total regional volume for the period.

Cross-border property investment activity also continued to recover last year, accounting for US$11 billion of the total transaction volume, up 96 percent year-on-year but still well below the 2007 level of US$27 billion.

Investment by non-Asian international investors reached US$4 billion, while investment activity by Real Estate Operating Companies (REOCs) and institutional investors stood at US$13 billion, up 74 percent from last year. The previous year. Meanwhile, investment activity by Asian REITs rose 195 percent to US$10.5 billion.

“Both foreign and domestic investors continued to be active in 2010. We expect that levels of activity will increase in 2011, as both foreign and domestic investors tap into the growing pool of capital looking to secure or increase its presence in Asia,” said Greg Penn, CBRE Executive Director of Investment Properties for Asia.

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