Asian outbound investment surged 40 percent year-on-year to reach US$16.2 billion in H1 2014, with Singapore contributing 29 percent of the total figure, CBRE said.
This makes the city-state the largest source of Asian outbound investment for the first six months of the year, followed by Hong Kong (25%), China (23%) and Malaysia (5%).
The report noted that Singapore-based investors were driven overseas by domestic yield compression and a lack of suitable assets.
Over in Hong Kong, domestic cooling measures were the main reason why investors chose to look further afield.
Although New York and London remain the top two destinations for real estate investment, savvy Asian investors with overseas experience are beginning to shun gateway cities.
London in particular has seen a marked decline in Asian cross-border investment, down from 41 percent for the whole of last year to 25 percent in H1 2014.
According to CBRE, more interest is being recorded in continental Europe and US west coast cities, such as Los Angeles and San Francisco.
Marc Giuffrida, CBRE’s Executive Director, Global Capital Markets, Asia said: “We are seeing the early adopters of global investing now starting to evolve their strategies to include new markets and asset classes. So, for example, while London’s volumes are lower than the same time last year, we are seeing more capital extend into UK regional areas and Europe, where investors feel there is less competition and the potential for enhanced yields.”
At 63 percent, offices are the most traded asset class, followed by hotels (25%), retail (7%), industrial (3%) and mixed-use (2%).
Going forward, the consultancy expects Asian outbound investment in FY2014 to surpass 2013’s record level.
Romesh Navaratnarajah, Singapore Editor of PropertyGuru Group, wrote this story. To contact him about this or other stories email romesh@propertyguru.com.sg
