Why Asia Now: The case for investing in Asia real estate
Thursday, 23rd May 2024
Source : Tim Jowett

Very simply, a compelling case can be made for having an Asian real estate allocation in global investor portfolios.

This case is based on four fundamental pillars:

1. Positive Regional Growth Outlook -

The region has become wealthier, stronger economically, and more self-reliant. Asia has been, and is expected to remain, the major regional contributor to global growth. These trends are underpinning healthy real estate demand fundamentals.

2. Increasing Benefits from Diversification -

Correlations between Asia and the United States/Europe, as well as between the region’s major economies and real estate markets, have fallen as trade and economic growth patterns shift. Intra-regional diversification supports a more stable return profile (lower downside volatility) and attractive risk-adjusted returns, including currency impacts.

3. Depth of Opportunity - 

The broad scope of value-add opportunities fostered by secular growth trends both in traditional and alternative asset classes is supplemented by resilient, low-volatility sectors with strong rental growth. Asia offers differing risk/return profiles from other global regions with meaningful differences within the region by sector, and with supply constraints helping to support positive rental growth.

4. Attractive Entry Points -

Investors can tactically deploy capital by focusing on pockets of emerging value in different countries at different cyclical positions driven by rates and pricing. Since 2022, Australia and New Zealand have demonstrated more substantial moves in rates than North Asia with consequential impacts on liquidity and market pricing.

Download the full paper to learn more about the case for investing in Asia real estate.

Tim Jowett
Managing Director,
Head of Asia Research at Hines

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