By Michele Batchelor and Paul Gordon, Bloomberg
Singapore: Global commercial property investments in 2007 will probably exceed last year’s $682 billion (Rs3,030 crore), driven by demand for real estate in Asia, according to a report by Jones Lang LaSalle.
Commercial property investments rose 41% to $94 billion in Asia in 2006, compared with those in the US, which gained about a third to $283 billion, the report said. Asset sales in Europe surged 44% to $305 billion last year, the most active real estate market for investments, it said.
Investors are focusing on Asia as the region’s economic expansion is expected to drive demand for real estate. East Asian economies including China and India are expected to expand 4.4% this year, compared with 2.7% in the US and 2% in Europe, according to the Asian Development Bank.
Asia is “certainly on the top of most investors’ shopping list at the moment,” Guy Hollis, international director at Jones Lang LaSalle, a property consulting group, said in an interview. There’s “$5 of money chasing every $1 of product, and in Singapore, it’s probably $7 to $8 chasing $1.”
Last month, Citigroup Inc.’s property unit raised $1.29 billion for an Asian real estate-related fund, and Prudential Plc also plans to invest as much as $1 billion in the region’s property market.