A panel discussion of speakers yesterday noted that the global economic crisis has caused the property investment landscape to change significantly.
In an annual real estate conference and exhibition for investors, Blake Olafson, Asia real estate group’s head and director said property investors are going back to basics.
“For example, pension funds that used to invest in riskier asset classes are now beginning to redirect their investments into less risky assets,” Olafson said.
“Looking at it from a global economic perspective, the Asian real estate market had become a market where everyone was trying to get in, everyone was becoming a property developer,” Managing Director of Tractus, John Evans has agreed.
The back-to-basics approach is a good strategy so that investors could make existing assets function harder.
“There’s a lot more emphasis around true asset management, a shift towards hiring third-party facilities managers, and much more effort is going into tenant retention strategies,” Olafson said. “Before the downturn the focus was on building development, now asset management has become a lot more important.”
According to Olafson, property investors who goes back to their basic competencies, and combines tighter credit conditions, are starting to drive-up a ‘flight to quality’.
Panelists in the conference agreed that liquidity is starting to return to the Asian market, even though banks are still very discriminatory about which projects to sponsor.