Cross-border activity in Asia Pacific is at a 10 year high, according to Real Capital Analytics.
Investors have not been so busy internationally since 2007, RCA found, however the sources of cross-border capital have changed since the last peak.
“Then, the flows were driven by Australian and Singaporean sources. Now, next to the Singaporeans, Chinese and Hong Kong investors dominate,” says Petra Blazkova, senior director, analytics for APAC at RCA.
Chinese buyers were the largest group over the last 12 months despite Beijing’s capital restrictions. Hong Kong, in turn, has been targeting China but also placing capital in Singapore and Japan. Singapore investors are more established cross-border players in Asia Pacific and their performance is more consistent over time. Over the last 12 months, they have increased their spending most significantly in Australia, Japan and India.
Major cities, led by Tokyo, were the most active metros in the first quarter, while Hong Kong showed some of the most startling growth. Link REIT’s completion of a deal to sell $2.95bn of shopping malls swelled the city’s retail transactions.
Meanwhile, Shanghai recorded the third-highest commercial real estate investment volume in Asia Pacific, after Hong Kong and Tokyo. This was mainly driven by office and hotel transactions.