Competition for real estate assets in Asia Pacific heated up in 2015, with a surge of major transactions in Greater China and around the region. And one of the major beneficiaries of this boom was property brokerage JLL, which advised on $16.6 billion in transactions in Asia Pacific last year, to lead all property brokerages in the region.
The US-based real estate services firm advised on 27.8 percent of the nearly $60 billion in Asia Pacific investment deals that involved a broker last year, according to data from Real Capital Analytics.
“2015 was a stellar year for real estate investment in Asia Pacific thanks to continuing demand from investors wanting to buy into the growth story in the region,” says Stuart Crow, Head of Asia Pacific Capital Markets, JLL. “We are delighted to have achieved top ranking with RCA for five consecutive years, which shows the strength of our platform to serve investors in Asia Pacific.”
Investment brokerage can be a primary source of revenue for real estate service firms globally, with property owners typically paying brokers one percent of an asset’s sale price for deals conducted in Greater China. By that standard, JLL would have earned $166 million in fees for its Asia Pacific investment advisory services in 2015.
Major Deals in Hong Kong and China Help Drive Up Investment Volumes
Last year was the fifth straight year that JLL’s team had tallied the most investment deals in the region, according to RCA. The company also took the top spot in the hotel sector for the fifth year in a row, with a total of US$2.9 billion in hotel sales in 2015, representing a 57 percent market share in the region.
China saw a record year for investment deals both in volume and in individual deal values in 2015, as rising office rental rates helped to drive up commercial asset values.
In July last year Hong Kong’s Link REIT paid a record RMB 79,380 per square metre to acquire the first phase of the ultra-prime Corporate Avenue complex in Shanghai’s Xintiandi area. In Shanghai’s Pudong district, Carlyle Group and CLSA Capital Partners sold an office tower to Hong Kong-listed Yuexiu REIT for RMB 2.63 billion ($423 million) during August.
In Hong Kong, mainland developer Evergrande Real Estate set a new record for acquisition of a Hong Kong office building during November, by purchasing the Mass Mutual Tower in Wanchai from Joseph Lau’s Chinese Estates for HK$12.5 billion ($1.61 billion).
Also in November, China Life, a major mainland insurer set a new record for purchase of a commercial property in Hong Kong’s Kowloon area by purchasing two buildings currently under development at Wheelock and Company’s One Harbourgate complex for HK$5.86 billion ($755 million).