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Investment Preferences of Private Real Estate Investors Based in the Far East – October 2015

by Marian Rajanathan

  • 29 Oct 2015
  • RE

Preqin’s Real Estate Online service tracks 142 private real estate investors based in the Far East* region, collectively managing $10tn in total assets. As shown in the chart below, the largest proportion of Far East-based private real estate fund investors are insurance companies (20%), followed by banks (18%) and private sector pension funds (14%). Japan-based firms (41%) form the largest proportion of these investors, followed by investors based in South Korea (37%) and Singapore (15%).

There is substantial preference for lower risk private real estate vehicles among these investors: 71% and 52% of Far East-based investors favour core and core-plus strategies respectively, above the 46% and 42% of investors with a preference for opportunistic and value added funds. More than half of these investors favour investing in their domestic region, although a sizeable proportion (50%) still have a preference for the traditional markets in North America.

Over the next 12 months, 19% of Far East-based real estate investors are actively looking to invest in private real estate funds. When making new private real estate fund investments, 67% will target Asia-Pacific-focused funds, while 38% will seek global-focused funds and 25% will target North America-focused opportunities. Core funds will be targeted by the vast majority of active private real estate investors in the next 12 months (81%), followed by core-plus (43%) and value added (24%) vehicles.

*Preqin defines the Far East region as including Brunei, Cambodia, Fiji, Indonesia, Japan, Laos, Malaysia, Mongolia, Myanmar, North Korea, Philippines, South Korea, Thailand, Timor Leste and Vietnam. 

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