WHILE investor sentiment on real estate generally remains positive in Asia Pacific, including the Philippines, investors from the region have broadened their interest to the rest of the world, global property monitor CBRE said.
According to CBRE’s 2016 Asia Pacific Investor survey, around 80 percent of 300 respondents across all sectors indicated their plan to invest this year in similar levels or more than they did in 2015.
But 42 percent said they intend to invest outside the region this year, giving reasons, such as concerns over slower regional economic growth and high asset prices.
CBRE said this is higher than the 31-percent registered in its survey a year ago.|
“The less positive outlook and high pricing in Asia Pacific are acting as a catalyst to push money out of the region,” CBRE said.
CBRE noted that in 2015, Asian investors made $40 billion worth of acquisitions outside the region, representing a 47-percent increase from the year before.
“Asia Pacific investors also plan to invest more capital internationally in the coming year, with 23 percent looking to invest more compared with the previous year,” CBRE said.
CBRE noted that most respondents said domestic and global economy is the biggest threat to the Asia Pacific market, amid downward revision of growth globally and regionally.
The survey also found that asset pricing and the availability of assets are the two biggest obstacles in acquiring assets.
CBRE said 38 percent of respondents were concerned about the increase in pricing, while 16 percent are concerned about the decreased availability of assets.
It also noted that over the past seven years, asset prices have risen at a faster pace than rental growth.
The survey showed that 16 percent of investors are worried about market oversupply, especially in China, India, and Jakarta.
Asian investors are less concerned about the pace of interest rate hikes, as only seven percent of respondents agreed to this.
“The impact of the rate hike in the U.S. implemented in December 2015 will be felt more strongly in open economies with free capital flows, namely, Hong Kong and Singapore,” CBRE said.
It added that other markets in the region are expected to maintain rates at low levels and possibly implement further cuts if economic growth weakens.