According to CBRE, Australia is now ranked second in the world for Asian outbound commercial real estate investment.
It says Australia moved up three ranks since 2019 from fifth position to second position globally. It adds that Australia is now number one in the APAC region for the most outbound investments from Asia.
The commercial real estate investment firm says outbound capital from Asia surged 69 per cent year-on-year in 2021 to US$54.6 billion, surpassing 2019’s pre-pandemic investment volumes.
“Our January 2022 Investor Intentions Survey had pointed to Australia retaining its relative attraction, with Sydney a Top 4 preferred destination for cross-border real estate investment,” Sameer Chopra, Head of Pacific Research says when commenting on the influx of Asian capital into Australia.
“The current geo-political situation, resilient cashflows of Australian assets and current exchange rate levels provide a good backdrop,” he adds.
CBRE notes the UK was the only European market to record a significant inflow from Asian capital in 2021.
It says more Asian investors have shifted their emphasis back to the APAC region, where they can rely on stronger networks and local expertise to execute and evaluate deals.
“Australia has benefitted as investors seek out markets that provide growth, scale, and a stable business environment,” Mark Coster, CBRE’s Pacific Head of Capital Markets says.
“We have seen increasing interest across all asset classes, particularly office, industrial and retail, as well as strong enquiry from groups looking to invest in real estate debt,” he adds.
CBRE says Singaporean capital dominated Asian outbound investment, accounting for six out of the top 10 outbound transactions while Singaporean investors deployed US $32 billion abroad, marking an increase of 164 per cent year-on-year.
The company’s data highlights that Singapore was the most active source of Asian outbound capital globally, with six out of the top 10 outbound transactions involving Singaporean institutional capital and developer funds.
It notes interest in the logistics sector also saw Asian investors pour US$24 billion into industrial and logistics assets in 2021, surpassing office investments for the first time and further compressing global industrial yields, which dropped to 3.7 per cent in Q4 2021.
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