Asia Pacific is expected to lead global economic growth in the coming years and has sustained all economic downcycle in the past two decades. With the region projected to contribute more than 40% of the global GDP by 2030, CapitaLand Investment Management says the growth story makes this an opportune time to invest in APAC real estate in the region.
Simon Treacy, CEO, and Yu Jin Ow, VP of Group Strategy & Research, in a recently published research paper talk about the three key themes for property investors exploring the APAC region.
CapitaLand says that the competitive advantages place the region in a strategic position as an attractive investment destination for institutional investors in the long term. APAC is expected considerably outpace global, US and Eurozone growth averages. It is estimated that half of the top 10 largest world economies will be in APAC in the next decade. The region is seeing high levels of migration, urbanization, and expansion of the services sector, along with a rise in the spending capacity of individuals.
While the West is steeply hiking rates, the APAC region is doing better with out-of-sync monetary policies which present attractive risk-adjusted opportunities. CapitaLand adds that while total returns are uneven in the region, income returns have been largely stable across the board. Property returns in APAC are highly diverse and disparate, which will be a key feature going forward.
However, CapitaLand says that deeper insights are needed to map the highly diverse investment opportunities in APAC real estate. The investment management firm goes on to talk about potential investment opportunities in the developed and emerging markets in the region, with the pros and cons of each.
Download the full research paper here.
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