All eyes are on China’s increasingly precarious housing market and its strict adherence to a zero-COVID strategy while elsewhere in the region an air of cautious optimism prevails as a slew of negative news from overseas is prompting investors to recalibrate risk expectations.
Simon Smith, Asia Pacific
China
“The year got off to a challenging start in China with a slowing economy and continued debt crisis exacerbated by lockdowns. Liquidity crunches may force developers to accelerate disposals at discounted rates while interest rate cuts and reduced quarantine periods should make investments more attractive.” – James Macdonald, China
Hong Kong
“In Hong Kong investment sentiment has stabilised as the local epidemic situation has improved but plenty of caution remains. Investors are keen to look for value-add strategies including redevelopment and conversion.” – Simon Smith, Hong Kong
India
“Private equity investment in life sciences research and development real estate in India has gained momentum since 2021 and we expect to see further growth in the segment, owing to favourable policies, a large workforce, and cost efficiencies.” – Arvind Nandan, India
Indonesia
“Positive figures for the Indonesian economy combined with an improved pandemic situation has revived sentiment in the property market with some sectors seeing higher absorption levels. Despite this rental and price levels have remained under pressure during the first half of the year.” – Tommy Henria Bastamy, Indonesia
Japan
"Overall, the Japanese real estate market continues to attract interest from overseas investors, thanks partly to a much weaker Yen, while some remain concerned about inflation and interest hikes, and are taking a wait-and-see attitude.” – Tetsuya Kaneko, Japan
Pakistan
“Pakistan loses almost 40% of its agricultural output to a lack of proper storage facilities. New developments in warehousing and cold chain facilities are being driven by the demand for higher standards and sustainability goals led by exporting firms and logistics operators.” – Nadine Malik, Pakistan
Malaysia
“Transaction activity in Malaysia during the quarter has been underpinned by interest in both the industrial logistics sector as well as sales of development sites and operating assets. With a number of notable deals scheduled for completion in the second half, the outlook is optimistic.” – Nabeel Hussain, Malaysia
Singapore
“Although transaction volumes in Singapore were lower in Q2/2022, the latent interest in our real estate remains very high.” – Alan Cheong, Singapore
South Korea
“Despite the heightened burden on investors from the upsurge in unit prices and the base rate, core investors continue to drive activity in the office sector.” – JoAnn Hong, South Korea
Taiwan
“A surge in COVID-19 cases and the risk of interest rate hikes in Taiwan have negatively affected buyer confidence with both land and commercial property market activity slowing in the second quarter.” – Erin Ting, Taiwan
Thailand
“Retailers are refocusing on key retail districts and the second quarter saw activity from major international brands. Despite the absence of Mainland Chinese tourists, the luxury retail market is proving surprisingly resilient.” – Thanjira Wongsathirayakhun, Thailand
Vietnam
“The first half of 2022 saw several macro prudential policies from the State Bank pushed forward. Not least is a review of foreign debt instruments, greater transparency around corporate bonds and a restriction in allocation of debt to real estate. Whist there may be some short term pain for exposed borrowers, the overall long term health of the property sector will be substantially improved.” - Troy Griffiths, Vietnam