LASALLE Investment Management plans to beef up its investment in Asia-Pacific’s real estate markets as it remains bullish about the region’s prospects, regional director David Edwards said yesterday.
As much as $20US billion could be invested in properties in the region over the next three to four years, he said.
‘At least half of our investment will be in Japan,’ he said. The firm previously intended to invest up to $15US billion in real estate in the region, but has upped its target to $15US-20 billion on the back of continued business and consumer confidence in the region.
The firm is ‘overweight’ on Asia, it said in its latest Investment Strategy Annual, which was outlined yesterday in Singapore.
In contrast, it has ’slight underweight’ calls on the European and US markets. In particular, the US and UK markets have been hit because of the credit squeeze, he said.
In Asia, real estate growth will be underpinned by urbanisation, the growing middle classes in China and India, and better availability of credit.
The firm is especially upbeat on Singapore. ‘Singapore’s real estate market has experienced a remarkable run since 2006 and stands out as one of the brightest spots in the Asia-Pacific region,’ said Mr Edwards.
In particular, Singapore’s office and residential sectors should see strong growth, he said. Prime office rents have climbed about 70 per this year, and could go up anywhere between 15-25 per cent next year depending on the location, he said.
And as Singapore’s economic growth spreads to a broader cross-section of the community, mass market residential and retail properties will perform well, and the trend could be expected to continue for several years to come, Mr Edwards said.
‘Given future prospects, core investors should continue with overweight allocations to Singapore,’ he said. But for investors at the higher end of the risk spectrum, LaSalle Investment is recommending moving towards a ‘neutral-weight’ allocation for Singapore.
LaSalle Investment has about $47US billion of assets under management in private real estate as well as publicly listed property securities. Of this amount, some $9US.5 billion is in the region.
Source : Business Times - 15 Dec 2007
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