Investors drawn to Southeast Asia

Published 26 January 2011
South China Morning Post

Investors drawn to Southeast Asia

Jones Lang LaSalle’s (JLL) latest Asia Pacific Property Digest highlights continuing improvements in market fundamentals across the region, underpinned by solid economic growth and high confidence levels.

Jane Murray, head of Asia-Pacific research said:

  • Take up space is strengthening and in some markets corporate occupiers are finding that space is in short supply
  • As a consequence, the leasing market is turning more in favour of landlords and more markets have moved to the upturn phase of the rental cycle.
  • Capital values started to recover earlier than rentals and have now bottomed in most markets.
  • Investment activity is strengthening, and we expect volumes to pick up further.

Jones Lang LaSalle’s (JLL)

  • Marked upswing in HK, SG and the mainland’s first-tier cities, especially in the luxury residential sector.
  • Intra-Asian and domestic investors continue to dominate purchasers across the region.
  • Improving market fundamentals are expected to bring in more buyers.

Colliers International Survey 2010

  • 73% of Asian respondents expect to expand their property portfolio this year – 91% of them buying in the domestic region.
  • Domestic and International investors are particularly active in the real estate markets of Asia, where economic prospects look stronger than the Western World.
  • Improving economic conditions have brought an end to declining real estate prices and rents in most Asian countries.
  • Singapore and Shanghai as the hottest Asian markets this year.
  • Singapore has strong office occupancy, current price level for offices becomes attractive for investors.

Pricewaterhouse-Coopers (PwC) and the Urban Land Institute (ULI)

  • Clouds has been lifted from Asia-Pacific markets reflected by buoyant real estate activity.
  • The region’s property markets, are strong enough to grow into the high expectations current pricing trends imply.

Where best to put your money?

Super Singapore! Why?

  • Region’s top real estate investment destination!
  • Foreign awareness of the prospects that Singapore has to offer!
  • Healthy rebound from the global financial crisis!

Singapore government’s long-term, sustainable view of the property market, its political stability and cooling measures to curb speculation are “altogether a potent combination”

Ranked Number 1: Singapore

“A market that has survived the economic fall and offers investors many opportunities”, as its financial and hi-tech industries flourish. Development of commercial and residential properties, particularly mixed-use properties, is of high interest.

Ranked Number 2: Shanghai

Down from top position a year ago. Despite sharp price hikes that may have dampened some investor interest, the city seems set for recovery and will remain a favoured investment target.

Ranked Number 3: Mumbai

Ranked third as the most promising investment market, and first as the most favoured development market. “Mumbai is clearly the best performing and most active real estate market”

Ranked Number 4: Hong Kong

Strong global appeal and robust rental demand. Although development outlook is less positive, emerging trends notes that the residential sector shows potential.

Ranked Number 5: New Delhi

The driving force is the government’s plans to boost infrastructure with new roads, railways and airports, and its approval for the urban development of tens of thousands of acres of land.

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About Jack Sheo

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