AUSTRALIA - Real estate in Japan, China and India could benefit from strong superannuation growth, according to CB Richard Ellis (CBRE).
Attendees of the World Series Real Estate seminar in Sydney were told the A$1trn (US$890bn) superannuation sector could double in eight to ten years which would oblige investors to look globally.
Andy Hurfurt, Japan director, CBRE, said Australian investors might initially be hesitant due to the year’s sub-prime crisis: “Lenders have become a lot more cautious. Whereas four to five months ago, you could secure 90% financing, now you’re struggling to secure 70%.”
Hurfurt added, however, generally prices had not reflected this more cautious approach resulting in core, rather than opportunistic money driving markets.
Historically Australian institutional investment had flowed towards the US, but this trend was changing according to the seminar speakers.
CBRE directors pointed to the B-grade Japanese office market and senior housing, due to the country’s changing demographic and expected appreciation of assets.
China was cited as hunting long-term foreign investment. Despite new regulatory challenges, CBRE believed there were opportunities to form partnerships and joint ventures with domestic players to produce specifically targeted deals.
India was shown to be an interesting prospect, but infrastructure and transparency issues had made it difficult for investors to access the market.
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