Real Estate Asia Pacific 2019, a real estate forecast jointly published by the Urban Land Institute (ULI) and PwC trends manifest a flourishing picture of the logistics infrastructure following the implementation of Goods and Services Tax (GST) that has revolutionised how goods are delivered across the country.
According to the report, at the Asia Pacific region level, ongoing competition among investors to place capital is continuing to shape how investors approach the sourcing of assets, despite signs the market may now be approaching a cyclical top.
In particular, value-add plays continue to be a focus, as owners look to upgrade assets by providing more flexibility, better user experience, and improvements leveraging design and technology functions.
As a result, investors today say they are likely to be more site specific, working from the ground up rather than the top down.
The only sector where investor opinions were uniformly bullish, investment allocations to the sector have risen significantly in 2018. As cities are becoming denser and housing costs rise, more developers are looking to co-living as a way to pack more people into smaller areas.
The ongoing build-up of liquidity across the Asia Pacific region still leads to huge sums of money crossing borders, to be invested in foreign real estate assets.
Strong outflows in the region seem certain to continue, especially with new reserves from Japan likely to enter the mix in 2019, the report said.
“India’s rapidly growing capital markets mean demand for high-quality offices is booming in Mumbai,” said John Fitzgerald, CEO of ULI Asia Pacific. “The report shows that despite apparently high vacancies, ongoing shortage of modern office stock mean new supply tends to be absorbed quickly.”
The Emerging Trends report provides an outlook on Asia Pacific real estate investment and development trends, real estate finance and capital markets, and trends by property sector and metropolitan area.
It is based on over 350 survey responses received from real estate professionals, including investors, developers, property company representatives, lenders, brokers and consultants.
“India continues to remain one of the most attractive investment destinations in the Asia Pacific region. With most of the other cities, near the top of the cycle in terms of rent and capital values, India still offers value creation opportunities,” added Bhairav Dalal, Partner – Real Estate Tax, PwC India.