Investing in real estate secondaries in Asia
The recent volatility in global stock and bond portfolios has fundamentally reinforced the need for the secondaries market. Elevated public-market valuations in 2021, superseded by a stark correction in 2022, have driven the denominator effect — the relative weight of private holdings now represents an enlarged slice of limited partners’ (LPs) overall portfolio. A perfect storm of rising rates, intensifying inflationary pressures and the precipitous cliff of unrealized value across mature private market fund vintages has exacerbated this effect, amplifying investors’ need for strategic portfolio rebalancing.
In Asia, this has triggered a trend of “West selling East.” Amidst such heightened market uncertainty, North American and European investors have been actively seeking near-term liquidity for their noncore Asian private market exposure to pivot back to their home markets. As a result, many of these LPs have turned towards the secondaries market to obtain liquidi