Mingtiandi

Asia real estate and outbound investment news

  • Facebook
  • LinkedIn
  • RSS
  • Twitter
Sign Up / Login Logout

Lost your password?
Register
Forgotten Password
Cancel

Register For This Site

A password will be e-mailed to you.

  • Capital Markets
  • Events
    • Mingtiandi 2023 Event Calendar
    • Mingtiandi APAC Residential Forum 2023
    • Mingtiandi Asia Logistics Forum 2023
    • Mingtiandi Hong Kong Focus Forum 2023
    • Mingtiandi APAC Data Centre Forum 2023
    • Mingtiandi Asia Office Strategies Forum 2023
    • Mingtiandi Singapore Focus Forum 2023
    • More Events
  • MTD TV
  • People
  • Logistics
  • Data Centres
  • Asia Outbound
  • Retail
  • Research & Policy
  • Advertise

APAC Office Markets Resetting Say Nuveen, Link REIT, Brookfield, C&W: MTD TV

2022/11/15 by Beatrice Laforga Leave a Comment

https://player.vimeo.com/video/771039654?h=b211a83684

 
Buyers and sellers of office properties in Asia Pacific have moved into “price discovery mode” after a series of rate hikes and other macroeconomic challenges slowed trades of commercial properties this year, according to senior executives from Nuveen, Link REIT, Brookfield Asset Management and Cushman & Wakefield appearing at a Mingtiandi event today.

In the panel discussion on core office strategies, Louise Kavanagh, chief investment officer and head of Asia Pacific real estate for Nuveen, said global investors remain underweight on office assets in the region, although inflation, rising borrowing costs, construction risks and other factors have slowed big ticket deals in recent months.

*I think it is a momentary pause and we’re in a price discovery mode at the moment so everyone is just waiting to digest some of the downside risks and look at the recalibration in pricing,” said Kavanagh  “So I think we will see momentum pick up again, perhaps in the next year as more allocation will need to be made to the region… There’s a lot of things that are feeding into this, but we are seeing pockets of hope in some of these markets.”

Speaking in the same panel, which was sponsored by Yardi, Kenny Lam, CIO for strategic investment at Hong Kong’s Link REIT described a similar scene, with global investors taking a “wait-and-see approach” as the gap between seller asking prices and buyer expectations has grown in recent months.

Occupier Demand Endures

With data from MSCI Real Assets showing that office deals plunged 45 percent to $14.9 billion during the third quarter compared to a year ago, a broad-based recovery may be on its way in less than a year, as US interest rates level off, according to Gordon Marsden, a regional director for APAC capital markets at Cushman & Wakefield speaking in the panel.

Louise Kavanagh, Chief Investment Officer and Head of Asia Pacific, Real Estate, Nuveen
Louise Kavanagh, Chief Investment Officer and Head of Asia Pacific, Real Estate, Nuveen
Kenny Lam, Link REIT
Kenny Lam, Chief Investment Officer, Strategic Investment, Link REIT
Gordon Marsden, Cushman & Wakefield
Gordon Marsden, Regional Director, Capital Markets, Asia Pacific, Cushman & Wakefield
Yiwen Yang, Senior Vice President of Real Estate Portfolio Management, Brookfield
Yiwen Yang, Senior Vice President, Portfolio Management, Brookfield Asset Management

“I very much see this as a relatively short term pause in terms of activity,” Marsden said, while pointing to the second half of 2023 for a likely rebound in deal activity.

“Already we’re beginning to get some price discovery as to where the markets are beginning to reset to,” he added, pointing to expectations of slower rate hikes by the US Federal Reserve in the coming months.

Marsden noted that, across APAC, occupiers grew their workplace footprints by 47 million square feet (437,000 square metres) in the nine months to September, equivalent to more than three-fourths of the 60 million square feet of space absorbed by office users in all of 2021, in a sign that demand is recovering.

Singapore Shines

Among the strongest markets for offices in Asia Pacific is Singapore, where Nuveen teamed up with JP Morgan Asset Management to acquire One George Street in Raffles Place for $944 million one year ago.

With Southeast Asia enjoying an economic upswing and the supply of office properties remaining tight in Singapore, Kavanagh said Nuveen has been able to achieve positive rental reversions of 11 percent at its 23-storey property with conditions setting the firm up for more revenue increases in the future.

“I think the Singapore office is one of the standout markets when we look across the region…  We’re factoring in about 18 percent growth (in rents across the market) over the next five years,” she said.

While transaction volumes have been falling in Singapore’s rival to the north, Marsden said that office landlords in Hong Kong have shown “incredibly strong” holding power with regard to asset pricing as most are not under pressure to sell properties at steep discounts, apart from some pockets of distress.

Marsden traced the city’s slowdown in office transactions this year to weak leasing demand and a gloomy outlook for rental growth. With challenges such as the SAR’s zero-covid policy seeming to subside, he sees the slide in grade A office rents in Central slowing down to between 3 to 5 percent this year, while adding that rental declines might persist until 2025.

Top Markets in Focus

Yiwen Yang, Brookfield senior vice president for real estate portfolio management for Brookfield, pointed to opportunities in South Korea where the Canadian investment group already owns the International Finance Centre Seoul commercial complex.

While the Korean property market also faces challenges arising from high interest rates and slowing economic activities, Yang said her team sees opportunities to profit from value-add strategies and asset enhancement initiatives in the country.

“If we’re looking into investment in a core office in Korea at this moment, we’re looking at a very active asset management plan, value-add strategies to make up for potentially lower office rental growth, given the interest rate environment and the impact on corporate profits,” she said.

Kavanagh said that Nuveen is also actively looking at the Korean office market, where it sees opportunities to acquire assets being divested by local institutions working to reduce debt levels.

Value-Add Up Next

Following the core market discussion, Mingtiandi’s Office Strategies Forum 2022 will continue at 10:00 AM Hong Kong time on Thursday, 17 November with a panel focusing on value-add opportunities in Asia Pacific.

That look at higher-yielding office strategies will include Francis Li, international Director, vice president and head of capital markets for Greater China at Cushman & Wakefield, Chedli Boujellabia, managing partner and CEO with Japan-based investment manager Alyssa Partners; Thomas Au, a managing director with Invesco Real Estate who heads investment strategy for the firm in Asia Pacific and David Green-Morgan, head of real assets research for information provider MSCI.

With occupiers and landlords re-evaluating the workplace post-pandemic, Mingtiandi will explore the future of the office in a panel at 10:00 AM Hong Kong time on Tuesday 22 November.

Appearing in that final panel in this year’s office strategies forum will be Nadia Zhu, regional managing director for Hong Kong, Macau and Taiwan with shared office provider The Executive Centre; Claude Touikan, co-founder and executive director with design and architecture firm Lead8; Anshul Jain, head of Asia Pacific tenant representation and managing director for India and Southeast Asia at Cushman & Wakefield and Eric Schaffer, CEO for Asia Pacific at workplace technology firm essensys.

Share this now

  • LinkedIn
  • Share
  • Tweet
  • Email

Filed Under: Events Tagged With: Brookfield Asset Management, Cushman & Wakefield, daily-sp, Featured, highlight, MTD TV, MTD TV Video, Nuveen

Leave a Reply

Your email address will not be published. Required fields are marked *

Get Mingtiandi Delivered

MTD TV

MTD TV Greater China REIT
SF REIT, C&W and Baker Mac See Greater China REIT Sector on the Rise: MTD TV
Greystar Nears First Closing of $1B APAC Multi-family Venture: MTD TV

More MTD TV Videos>>

People in the News

Johnny Shao CPE
Asia Real Estate People in the News 2023-03-27
Jonathan Yap CapitaLand
Jonathan Yap Named CapitaLand Development CEO as Leow Retires Early
Grace Woo Chia-ching, executive director of CK Asset (Getty Images)
Asia Real Estate People in the News 2023-03-20
Eugene Kohn KPF
Asia Real Estate People in the News 2023-03-13

More Industry Professionals>>

People in the News

Asia Real Estate People in the News 2023-03-27

Johnny Shao CPE

Top level moves at European and Asian fund managers lead this week’s list of personnel changes from around Asia Pacific … Read More>>

Jonathan Yap Named CapitaLand Development CEO as Leow Retires Early

Jonathan Yap CapitaLand

Singapore property giant CapitaLand on Thursday announced the upcoming retirement of CapitaLand Development CEO Jason … Read More>>

Asia Real Estate People in the News 2023-03-20

Grace Woo Chia-ching, executive director of CK Asset (Getty Images)

Senior changes at developers in Hong Kong and mainland China lead this week’s review of personnel changes in Asia, with … Read More>>

Asia Real Estate People in the News 2023-03-13

Eugene Kohn KPF

The passing of a global architecture giant leads this week’s round of personnel updates on Mingtiandi, as KPF mourns the … Read More>>

More Industry Professionals>>

Latest Stories

Country Garden Center In Shanghai
China’s Country Garden Posts First Loss Ever and More Asia Real Estate Headlines
Ng Kiat Mapletree (1)
Mapletree Logistics Trust Buying APAC Portfolio From CBRE IM for $687M
Ren Letian of Yangzijiang Shipbuilding
Viva Land Selling Singapore Office Tower at 20% Mark-Down After Vietnam Arrests

Sponsored Features

TE Capital's Solitaire on Cecil
Pair of Floors Sold as TE Capital, LaSalle Launch Cecil Street Office Tower in Singapore
What Do Real Estate Investors Really Want?
Douglas Wu of Fairland
Fairland Creates Spark City Lifestyle Hub to Energise Hong Kong’s Cheung Sha Wan

More Sponsored Features>>

Connect with Mingtiandi

  • Facebook
  • LinkedIn
  • RSS
  • Twitter

Real Estate News

  • Capital Markets
  • 2022 Event Calendar
  • MTD TV Archives
  • People
  • Logistics
  • Data Centres
  • Asia Outbound
  • Retail

More Mingtiandi

  • About Mingtiandi
  • Contact Mingtiandi
  • Mingtiandi Membership
  • Newsletter Subscription
  • Advertise
  • Terms of Use
  • Privacy
  • Join the Mingtiandi Team


© 2007-2023 China Advertising Media Ltd (Samoa). All rights reserved.

  • This field is for validation purposes and should be left unchanged.