Investor interest in Asian properties

Country:  Australia; China; Japan

25 November 2008

Asia's battered property markets are starting to attract investor interest, with Japan, Australia (Asia-Pacific), China, Hong Kong and Singapore among their top picks in the region.

Property fund manager LaSalle Investment Management predict Hong Kong and Singapore to recover first from the financial turmoil, and regional director David Edwards told Reuters; "We are seeing a decline in values throughout the region. There are properties that are being sold at much lower prices than the market's perception of their values."

ING Real Estate plans to double its investments in Asia to $1bn (£664,000), with most of its investors in the UK and Europe wanting to diversity into the region, said the firm's Asia Pacific managing director Nicholas Wong.

"Most of our clients are from the UK and Europe and traditionally, they invest only at home," Wong said. "Now, they want global exposure and most of them want to go to Asia for diversification."

With Hong Kong, Japan and Singapore in recession, Asian developers are battling falling demand and tighter credit, even after efforts by central banks to encourage lending by slashing key rates.

China's ailing housing market may stabilise in about six months and recover in two years, before most other Asian countries, says Cheng Soon Lau, managing director at Invesco Real Estate Asia.

Invesco is planning to invest directly in China, Japan, Hong Kong and Singapore, buying office blocks and building housing.