KUNIHKO OKUMURA, CO-CIO, LA SALLE ASIA PACIFIC
The pandemic effect
Uncertainty will remain a dominant theme in 2021, however China’s relative strength in recovering from the COVID-19 pandemic, coupled with the resiliency in many of Japan’s real estate assets last year, bode well for the overall outlook and strategy of real estate investments in Asia Pacific this year. The shift towards online retailing during the pandemic has generally translated into a strong demand for industrial real estate assets as investors look out for resilient strategies that are less impacted by the geopolitical situation. At the same time, private equity and institutional investors will continue to drive investments in the industrial sector across the region.
As people spend more time at home due to the growing trend of remote working, the demand for residential assets with extra amenities is likely to increase. Developing or converting existing buildings into professionally managed apartments will be an interesting theme for value-add players, aiming for a takeout by core capital seeking for real estate with stable cash flow.
There’s also a growing trend of automation within logistics, which has accelerated during the pandemic, making the sector even more attractive to investors. Logistics real estate is certainly a winner in a post-COVID environment as not only have the demand drivers improved, but we also witnessed capital rotation towards the asset class, enhancing the overall liquidity.
© 2021 funds europe