PETALING JAYA (July 22): The volume of commercial real estate investment in Asia-Pacific reached US $ 83.5 billion (RM 353 billion) in the first half of 2021, resulting in year-on-year growth ( annual) by 39%, said real estate consultancy firm JLL.
Although the investment volume in 1H2021 is 6% lower than in 1H2019, in its report “APAC Capital Tracker 2Q2021: Reallocation Underway”, JLL anticipated an increase in the investment volume in Asia-Pacific of 15 to 20% by the end of the year.
JLL CEO for Asia-Pacific Capital Markets Stuart Crow said real estate investment in Asia-Pacific is clearly back as investors reaffirmed their positive outlook, ensuring a significant recovery in slipping volumes annual in the first semester.
“We expect activity to continue in 2H2021 as investors turn to portfolio transactions, business sales and leasebacks, and seek greater diversification in sectors such as logistics and industry, life sciences and the multi-family, âsaid Crow.
China, Australia and South Korea accounted for 69% of the total investment volume, while activity in Japan was lower due to the Covid-19 disruptions. The report also found that investments in offices, logistics, industry and retail accounted for 31%, 30% and 30% respectively for 2Q2021.
Notable transactions in 1H2021 include Dentsu’s Tokyo head office, which is about to be acquired by Hulic for up to $ 3 billion; and the David Jones flagship store in Sydney, which sold to Charter Hall for US $ 374 million (AU $ 510 million) with a 20-year leaseback.
Meanwhile, Regina Lim, head of capital markets research at JLL Asia-Pacific, expects logistics and industrial investments to double to between US $ 50 billion and US $ 60 billion by 2025, while that at the same time, investors are seeing signs of stabilization in office markets.
âWith the continued appetite for defensive assets and expected growth avenues like sale and leaseback, we maintain our expectations that investment volumes will increase 15-20% in 2021,â Lim said.
Malaysia: Strong demand for warehouses
Likewise in Malaysia, the demand for warehouse space is high, driven by the growth of e-commerce and an increase in manufacturing activities due to improved demand for manufactured goods globally, especially electrical and electronic products.
âMany investors, including REITs, are diversifying their real estate portfolios in this sector as it has proven to be the most resilient amid the pandemic,â said JLL Property Services country head YY Lau (pictured) .
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