Property markets in Asia Pacific are expected to outperform the global average.

 

According to CBRE's 2015 APAC Real Estate Markets Outlook report, Asia Pacific's economic growth will continue to outpace the global average in the coming years, owing to fast urbanization, demographic expansion, a rising middle class, and increasingly rich families. properties for sale in qatar

These trends result in increased demand for high-quality real estate, particularly suburban shopping complexes and residential homes. In 2015, Asia Pacific will continue to outpace the rest of the world, with Oxford Economics forecasting 4.4 percent economic growth vs 2.9 percent internationally. In the meantime, CBRE predicts that overall investment turnover in Asia Pacific would rise 5% year on year to US$118 billion in 2015.

According to Dr. Henry Chin, Head of Research, CBRE Asia Pacific, a number of factors are supporting the region's investment growth, including newly raised private equity real estate funds, an increase in institutional investors' allocations to Asia Pacific, growing activity by Asian institutional investors, and adequate debt financing.

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Due to the prolonged QE program undertaken in the Eurozone and Japan, CBRE does not expect most markets to suffer considerable upward pressure on interest rates this year. The recent sharp drop in oil costs has also reduced the impetus on the Federal Reserve to raise short-term interest rates. With prominent recent instances in China, India, South Korea, and Australia, policymakers are more ready to decrease interest rates to help their economy. Obtaining low-cost financing will provide investors with a plethora of real estate investment alternatives "Dr. Chin stated.

"Furthermore, the combination of high liquidity and a lesser likelihood of interest rate hikes provides support to landlords holding prime assets, allowing them to maintain current prices. Landlords will be hesitant to sell their properties at a loss "he continues.

Corporate and investor confidence in the region is still high, resulting in strong demand from both occupiers and investors for real estate. In 2015, CBRE anticipates rental and capital value growth of 2-4 percent in the office, retail, and industrial sectors:

Office: Driven by the markets in Tokyo, Bangalore, and Singapore, office rents in the region will continue to rise steadily, albeit at a slower rate of 3.2 percent from 3.6 percent. Cost containment will continue to affect corporations, leading in cautious expansion throughout the region. Companies are willing to consider opportunistic improvements and activity-based workspaces as part of their long-term portfolio strategy and workplace improvement.

Rents will continue to rise, but at a slower rate—rental growth is expected to fall to 2.4 percent from 5.4 percent this year. Tokyo will be the best performer in the area, with rents increasing by 10%, followed by Beijing and Shanghai. With rising operational expenses and more competition, retailers in the region will concentrate on securing prime space in important growth markets.

Industrial: Stronger logistic rents will be seen in 2015 as a result of robust demand, particularly in Hong Kong, Osaka, and Shanghai. The robust expansion of e-commerce and the desire for increased operational efficiency will result in significant demand for logistics space in most regions, with Asia Pacific's overall logistics rental growth anticipated at 2.9 percent.

Markets will continue to experience diverse economic cycles, causing growth to diverge throughout the area. Japan, for example, enters 2015 at the start of an upward cycle thanks to the depreciation of the Japanese yen. In 2014, a jump in visitor visits aided export growth—industrial production is predicted to rise, and office and retail rents are expected to rise as well. Corporations in Japan are also considering shifting production from overseas to Japan, which would boost the economy even further. On the other hand, China's economic growth has slowed to 7% and is likely to decline even further to roughly 5% by the end of the decade. The government is mostly to blame for the downturn, as authorities work to restructure the economy. Despite this, this market will continue to be the primary focus of business expansion in 2015.