Asia Pacific listed real estate companies were up slightly in March, posting returns of 0.3 percent, according to SNL Financial, with regional returns denominated back to US dollars and country returns in local currency. 

Institutional investors often ask which is better: listed or unlisted real estate securities in Asia Pacific. The short answer is they both have advantages — it is not an either/or proposition. 

The still-stuttering global economy does not offer a lot of compelling venues for institutional real estate investors, or their brethren in equities or bonds. 

I recently wrote a short column on the effects of subdivision of commercial property in Asia Pacific, in particular Hong Kong and Singapore. It received considerable comment and feedback in the region, notably from research heads in large real estate funds. I am grateful for their comments and have refined the arguments presented here, along with data not present in the original note.  

Today, the phrase “emerging market” is almost synonymous with the acronym “BRIC”. Conceived by Goldman Sachs’s Jim O’Neill in his 2001 paper, titled Building Better Global Economic BRICs, the economies of Brazil, Russia, India and China have grown substantially during the past decade from the standpoints of GDP and investment. While their performance has validated O’Neill’s thesis, it is not necessarily given that these four countries offer the best emerging market risk-adjusted returns in today’s environment. 

The global financial crisis had profound implications for real estate, with trillions of dollars being wiped off the asset class and serious questions being raised as to the credibility of real estate as a significant element of institutional portfolios. Since that time, most real estate markets have experienced a recovery and, unlike other crises such as the early 1990s or the 1970s, investors have continued to demand exposure to the asset class.