Singapore leads regional outbound real estate investment in 1H2018: CBRE

/ EdgeProp
September 4, 2018 5:49 PM SGT
Singaporean capital accounted for 36%, or about US$9.1 billion ($12.5 billion), of Asia’s total outbound real estate investment in 1H2018, says CBRE. This came amid a slowdown in Chinese outbound investment. The region saw US$25.3 billion in outbound real estate investment activity during the period.
London continued to be a preferred destination for Asian investors, accounting for 26% of the region’s total outflows. Substantial funds from Singapore and Hong Kong were directed there to capitalise on the more favourable yields and longer rental periods presented by commercial properties that are unattainable domestically.
Singaporean investors favoured Europe for portfolio diversification, investing US$3.4 billion there in 1H2018, says Yvonne Siew, CBRE’s executive director of global capital markets, Asia Pacific. They were also active in the US logistics sector, building a US$2.27 billion portfolio in the same period.
She says that there is interest in the office and logistics sectors in the region and beyond, and for many investors “this is a long-term growth strategy as they seek to diversify their portfolios and enhance their yields given limited opportunities and compressed yields in the domestic market”.
“The slowing of Chinese investment has prompted the emergence of more diverse capital sources, which illustrates the depth of liquidity and appetite for offshore deployment,” says Tom Moffat, head of Capital Markets, Asia at CBRE. Chinese investors decelerated their acquisition of overseas assets and began some disposals, which are expected to continue as they strengthen their balance sheets.