PERE Europe: Asia family offices heading West

High-net-worth and family office cash is becoming a bigger part of the wave of capital from Asia entering real estate markets in Europe, according to panellists at the PERE Europe Summit 2016.

More Asian family offices and high-net-worth individuals are looking for real estate exposure in Europe, said panellists at the annual PERE Europe Summit 2016 on Tuesday.

Faced with a slowing economy at home, many Chinese investors are increasingly looking overseas to find returns. Chinese outbound real estate investment reached nearly $30 billion in 2015, doubling that of 2014, an April report by London-based consultancy Knight Frank said.
Most of this outpouring of capital has come from institutional giants acquiring trophy properties. For example, Ping An Insurance purchased Tower Place in London for $506 million in January 2015, and Anbang acquired the Waldorf Astoria in New York for $1.95 billion.

However, speaking to delegates at PERE's flagship event in London, Richard Divall, head of cross border capital markets EMEA at property services firm Colliers International, said: “Much more family office money is coming in [to Europe] from the region.”

“I see a lot of high-net-worth and family office capital moving out, and I don't see that slowing any time soon,” added Collin Lau, founder of Hong Kong based private equity real estate firm BEI Capital.

The panel said that the bulk of this family office and high-net-worth money was being deployed in Europe with Asian fund managers active in the region.

One such group taking advantage of the trend is KaiLong Rei. In April, the firm closed Outbound Investment Fund II, a follow-on vehicle to its maiden European fund, which was established late last year.