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ANREV: Asia outperforming rest of the world

Q2 performance figures show that Asia-Pacific property funds generated higher returns than other regions over the quarter with 2.14% compared to 2.04% in the US and 1.29% in Europe.

Asia was the top performing region for real estate funds in Q2, according to trade body ANREV’s quarterly index.

Asia-Pacific outperformed other regions over the quarter generating a 2.14 percent return compared to 2.04 percent in the US and 1.29 percent in Europe, as tracked by the Global Real Estate Fund Index (GREFI).

“Asia-Pacific non-listed real estate is performing well again this quarter and this is supported by strong performances of the more mature markets in the region – Japan and Australia,” commented Amélie Delaunay, director of research & professional standards, ANREV.

“These are very hot markets; a lot of capital is chasing good spreads in Japan and despite a slowdown in rent growth in Tokyo, demand is on the rise for office space. Australia, meanwhile, has probably the highest yields in the region for core properties.”

ANREV’s data revealed Japan funds showed the strongest performance in the second quarter returning 3.56 percent, a slight increase compared with Q1. Australia funds also continued to be strong, returning 3.38 percent in Q2 compared with 2.93 percent in the previous quarter. China funds recorded a negative performance of -3.64 percent.

Core funds in Asia-Pacific recorded a strong performance of 3.46 percent in Q2 compared with 3.36 percent in Q1 2016. Value-added funds fell to 1.86 percent in Q2 2016 from 3.45 percent in the previous quarter, while opportunity funds recorded a negative performance of -2.81 percent.

ANREV’s Q2 figures includes 93 funds and covers assets with a total gross asset value (GAV) of $100.5 billion. The GREFI Q2 2016 update release includes the performance of 477 funds representing $607 billion of total GAV; with 48 percent in US funds, 33 percent in Europe, 17 percent in Asia-Pacific, and the remainder in global funds.