Singapore largest source of Asian capital in global real estate

CRE Herald commercial real estate news

Singapore-based investors have continued its leaderships as the most active offshore real estate investor group in 2H 2018 in Asia, according to CBRE.

In 2018, 40 per cent of the Asian outbound investments has been realized by Singapore investors with USD 21.6 billion, in total outbound investments fell by 36 percent year-on-year to USD 53.8 billion.

In 2018 Koreans invest USD 7.3 bilion in global real estate market. Malaysia and India follow Koreans with %132 and %291 increase in overseas investments.

Meanwhile, Chinese investors deployed US$7.5 billion in capital into offshore real estate investments in 2018, a significant decline from US$35.4 billion in 2017.

Ms Yvonne Siew, Executive Director of Global Capital Markets, Asia Pacific at CBRE, said, “Singapore is the largest source of Asian capital in global real estate investments in 2018. Driven by limited opportunities and compressed yields in the domestic market, Singapore investors will continue to seek enhanced yields offshore to diversify their portfolios and achieve more sustainable growth. We expect the export of capital to continue in 2019, in view of the modest outlook in the domestic market.”

Which country is the best for Asian capital in global real estate ?

London remained the top destination for Asian capital, owing to strong fundamentals and its established standing as the preferred metropolitan area for first time buyers to invest.

Investors from Hong Kong, Singapore and Korea were the major buyers, accounting for over 85% of the investment activities. In 2018, 18% of total Asian outbound capital was deployed to London, up from 13% in 2017. The appetite for gateway cities was also reflected in Hong Kong (9%), Shanghai (9%) and Frankfurt (4%), growing or maintaining their percentage of total investment deployed for 2018.

“Asia-based investors remain hungry for offshore acquisitions, but will employ a more selective strategy in their overseas purchase activities. The hedging costs into certain countries are also impacting investment flows for many outbound Asian investors,” said Mr Tom Moffat, Head of Capital Markets, Asia, CBRE.

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