In Focus

There is increasing demand from WFH locals who want their own confined space.

Three US tech giants will build hyperscale data centres in Malaysia.

Sale-and-leaseback is amongst the fastest entry routes to invest in cold storage, says Colliers.

Discount retailers are now bumping luxury shops from Central Hong Kong.

The total value of major transactions jumped 53% to approximately US$354m.

Cold chain storage remains undersupplied in Asia on a per capita basis.

ESR Australia recently bought a portfolio of 45 properties for a whopping US$2.9b.

Investments jumped 68% and 280% in Australia and Singapore, respectively.

Half of the properties in APAC prime locations is over 20 years old.

Standard Chartered, DBS, Deutsche Bank and Societe Generale cut massive floor spaces.

Total net absorption doubled in Tokyo, Sydney, Singapore and Hong Kong SAR, reaching 322 megawatts (MW).

New Zealand posted the highest annual price growth in APAC at 19%.

Thanks to growth in logistics, data centres, and multifamily investments.

The distressed opportunities make great entry points into Japan’s promising hospitality market.

Stakeholders in Melbourne’s property markets have reason to be optimistic.

Investors spent US$116 billion on multifamily assets in the first nine months of 2020. Real estate investors are increasingly hunting for multifamily real estate, a sign of the broader pivot toward defensive strategies amid ongoing economic uncertainty. Investment in all real estate sectors fell 44 percent in the third quarter of the year, compared to the same period in 2019, according to JLL. However, multifamily has fared better than most other sectors, with investment falling, but by 27 percent. Investors picked up US$116 billion of multifamily assets in the first nine months of this year. Multifamily offers investors “a view through and beyond COVID-19”, says Gemma Kendall, head of multifamily investment, EMEA Capital Markets at JLL. "Housing demand remains high in many cities around the world and supply has struggled to keep up. As a result, investors are viewing multifamily opportunities as more resilient than other asset classes." Even at the height of the pandemic, and with the introduction of rent controls in many major cities, there has been little evidence that rents are going unpaid. A recent JLL survey of institutional owners of residential assets found that rent collection stood at 95 percent in the U.K., and at 94 percent in the U.S. In Europe, multifamily investment is up five percent year-to-date. In Asia Pacific, multifamily and build-to-rent investment topped US$7.4 billion in the first nine months of this year, up 83 percent year-on-year. Demographic shifts and institutional support are driving demand for Asia Pacific’s multifamily sector, explains Regina Lim, head of capital markets research, Asia Pacific, JLL. "Fundraising among global investors will further accelerate, with the focus being on both traditional markets like Japan and emerging renting markets like China, Australia and Korea." Japan’s multifamily market, the second largest in the world behind the U.S., is increasingly in the spotlight with investment almost tripling in the first half of this year. In August, German institution Allianz Real Estate invested $160 million in a portfolio of 18 Japanese multifamily assets for its core Asia-Pacific fund, while Blackstone paid US$3 billion in February to repurchase a portfolio of 200 apartments in Osaka and Tokyo from Chinese insurer Anbang. Partnering up While COVID-19 has accelerated investment, the multifamily sector was already attracting global private equity, investment managers, insurers and sovereign wealth funds. In the past decade, multifamily deals as a proportion of global real estate investment have roughly doubled to 25 percent. As it became more mainstream, it started appealing to a broader range of investors. In the U.S., AIMCO this year agreed a 10-year joint venture with a passive institutional investor for a US$2.4 billion portfolio in California. AXA IM Real Assets recently completed a major transaction, buying Dolphin Square, in London. The growth of experienced players is essential if the market is to evolve sufficiently to meet increasing demand, with partnerships becoming a popular choice, says Kendall. "We’ve seen investors employ such strategies to find the expertise that they require in new geographies,” says Kendall. “It’s also a relatively granular sector; portfolio aggregation has been a strategy adopted by many but growing organically takes time." For several institutional groups, the best way to enter the market has been to team up with players who can develop, source transactions and partner on the operational side. Nuveen Real Estate recently joined forces with Iberian investment manager Kronos to develop a €1 billion build-to-rent portfolio of 5,000 homes in Spain.