Real Estate in Asia market still attractive

Presided by experts in the real estate industry, the speaker remained optimistic about the long-term investment prospects in the region’s real estate market. “Clients are still looking to invest in the real estate market in Asia,” said Alan Dalgeish´s, executive director of CBRE.

With more banks failing in Europe and the United States, experts say investors have become wary of putting their money in banks.

Instead, they are looking at the real estate market in Asia as a potential investment destination as they have a direct stake in their investments.

Mr. Dalgeish´s comment is a welcome respite as gateway cities like Beijing and Singapore, have witnessed their investment sales market falling by almost 90 percent from the same period last year.

While investment interests are remind still abound, experts say Real Estate Investment Trusts (REITS) in the region like Japan and Singapore have been badly affected. Singapore REITS, for instance, have come down from their high levels registered in October 2008, which has affected investor’s ´ confidence level.

Investments aside, Arcapita´s director and head of real estate Asia Blake Olafson, addressed tenants´ issues at joint venture industrial properties in Singapore. Tenants had previously complained that they were unable to afford rentals at industrial properties.

However, Mr. Olafson says the rents they are paying now are below market rates. Moreover, there are measures in place to help them such as through rental rebates. “The rentals they are paying for are already discounted if you compare with current market rates. We are working with tenants on a case-by-case basis,”

Mr. Olafson said.

Other speakers at Cityscape Connect Singapore Business Breakfast included Peter Mitchell, CEO of Asian Public Real Estate Association (APREA) and Nick Crockett, associate director, structured finance at Asia Capital Markets.