Student housing, serviced apartments are in favour as offices, logistics lose shine: CBRE
Potential rate cuts could drive more money into the underinvested living sector in Asia-Pacific, CBRE says
These assets remained underinvested in the region and have the potential to deliver better returns as investors look to hedge against inflation, it said. Rising demand from expatriates and low home ownership levels are also aiding the market fundamentals, it said in a report on Monday.
Multi-family properties, a subset in the living sector, has become the most preferred asset class this year, displacing previous investor favourites like industrial and logistics assets and the office sector. Global funds are also considering student accommodation in Hong Kong and Australia as possible targets, it added.
The outlook for the market has brightened as global central banks prepare to cut borrowing costs, with the Federal Reserve odds-on to trim its target rate by at least 25 basis points on September 18. The Hong Kong Monetary follows the Fed decision in lockstep under its linked exchange rate system.
“Potential interest rate cuts will drive capital deployment and consolidation opportunities,” Greg Hyland, head of capital markets for Asia-Pacific region, said in the report. “With strong market fundamentals and resilient demand, the living sector offers institutional investors and private equity fund managers the opportunity to diversify their portfolio.”
