Real estate has seen increasing allocations from investors, as witnessed by a 9 percent rise in total transaction volumes in first half 2015, when compared with the same period last year. Cross-border investment activity has reached a peak on a global basis.
Australia largely was spared the ravages of the global financial crisis but, despite record-low interest rates, shoppers are cautious.
Twenty-seven years ago, when I was launching Institutional Real Estate, Inc, my business plan called for the development of a new magazine designed to meet the information needs of institutional real estate investors and the people and companies that serve them.
Each year, PIR publishes a new edition of the Australian Property Funds Industry Survey. This year’s survey profiled 76 managers with total assets under management of about A$286 billion (US$211 billion). This is the largest total recorded since the global financial crisis.
Extending its international property reach, a new partnership between a subsidiary of China Investment Corp, China’s US$740 billion sovereign wealth fund, and affiliates of AEW Europe, has acquired a portfolio of 10 shopping centres in France and Belgium.
Regardless of any other country-specific positive news, the Asia Pacific region was dominated by the Chinese market in July, as that country dealt with a massive stock market disruption and the subsequent end to a torrid run-up during the prior 12 months.
The Link Management Ltd, manager of The Link REIT, has agreed to acquire Corporate Avenue 1 and 2 in Shanghai for 6.6 billion yuan (US$1.07 billion). The seller was Shui On Land, which developed the towers in 2004.
Singapore’s Global Logistic Properties has agreed to buy 200 US warehouse properties from Industrial Income Trust for US$4.55 billion in one of the largest real estate deals of 2015.
Perhaps lagging their European brethren and some sectors in the US real estate scene, Asian institutional property investors increasingly are eying green measures and throwing around acronyms such as CSR (Corporate Social Responsibility), ESG (Environmental Social Governance) and GRESB (Global Real Estate Sustainability Benchmark).