VIDEO: Asian capital overseas still small

 Asian capital represents only 5 percent of the total real estate transactions in the US, UK and Europe.   

Asian investors still represent only a small percentage of the total volume of real estate transactions in the US and UK, with the bulk of them still majorly investing within Asia, said Simon Treacy, managing director, global chief investment officer and head of US Equity at BlackRock.

Speaking to PERE on the sidelines of the PERE Global Investor Forum held in Hong Kong this week, Treacy said that private capital for real estate investments continued to remain mostly domestic-focused in the US and UK.

“Even though there are some headline, big trophy transactions [by Asian investors overseas], the reality is that the weight of Asian capital going cross-border to UK, Europe and US represents not more than 5 percent of the overall transactions,” he said.

In his view, London and New York, specifically Manhattan, were “receiving disproportionate share” of Asian capital and were where most of these trophy transactions are happening.

Nonetheless, he said currently, 70 percent of real estate investment by Asian investors has been within the region.

Sharing BlacRock’s 2020 vision for the global real estate industry, he said that in six years, investors will have increased their real estate allocations from 8.2 percent currently to 10 percent, echoing the forecasts of many other industry participants.

He also expected Asian investors to increase their cross-border investments, again a theme widely anticipated to unfold.