2017亚洲房地产资本流动逆转（英文版）_16页_1mb

2017 – the year in which Asian property capital flows reverse: Fact or Fantasy?

Executive Summary

The document examines the trends in Asian property capital flows from 2008 to 2017, highlighting a long-term pattern of increasing outbound investments and declining inbound investments. Despite a slight reduction in 2016, the overall trend of capital outflows remains strong. The US and Middle East have become major destinations for Asian capital, while intra-regional investment has surged, suggesting growing confidence in the Asian property market.

Historic Asian Property Capital Flows

Pattern since GFC

• Outbound capital flows have risen significantly since the Global Financial Crisis (GFC), increasing 14x from USD4.2 billion in 2008 to USD58.9 billion in 2015.
• Inbound capital flows have fallen, decreasing by 35% from USD24.9 billion in 2008 to USD16.2 billion in 2016.
• Intra-regional capital flows have increased sharply, reaching USD69.3 billion in 2016, up 233% from 2008, and surpassing outbound flows for the first time since 2013.

Key Observations

• The long-term trend reflects general pessimism about emerging markets, not specific issues in Asian property.
• The US has been a major engine of global economic growth since the GFC, while many other emerging economies have slowed down.

Asian Outbound Capital Shifts to US

• Between 2009 and 2013, the UK was the main destination for Asian property investment.
• The US became a dominant destination in 2013, with investment rising to USD11.3 billion, representing 32% of total outbound capital.
• In 2016, US investment accounted for 49% of total Asian outbound capital, reaching USD29.1 billion.
• Mainland Chinese capital accounts for 43% of Asian investment in the US, driven by the depreciation of the RMB.

Asian Investors Prefer Office Property

• Asian investors favor office property outside their region, which accounted for 43% of total outbound investment in 2016.
• Hotel property was the second most popular segment, with 24% of outbound capital.
• Undeveloped land was the least popular segment, accounting for 9% of outbound capital.
• Intra-Asian investment shows a different pattern, with undeveloped land being the most popular segment (70% of total), especially in China and Hong Kong.

US and Mid-East Dominate Inbound Capital

• US investors have been the largest source of inbound capital for the past four years, accounting for 44% of total inbound investment in 2016.
• The Middle East overtook Europe in 2016, driven largely by the Qatar Investment Authority’s purchase of Singapore's Asia Square Tower 1.
• Office property is the most popular segment for non-Asian investors in Asia, accounting for 55% of total inbound investment in 2016.
• Retail (17%) and industrial (9%) properties also saw significant interest, with industrial showing growth potential due to e-commerce expansion.

2016: An Active Year for Asian Investment

• Intra-regional investment reached USD69.3 billion in 2016, a 34% increase from 2015.
• China overtook Japan as the top investment market in the Asia-Pacific region, with property transaction volumes reaching USD36.5 billion, surpassing Japan's USD29.0 billion.
• Hong Kong, Singapore, and South Korea also saw strong investment interest, with Hong Kong and Singapore experiencing 15% and 38% increases in transaction volumes, respectively.
• Seoul was a major surprise, with a 142% increase in transaction volumes to USD9.92 billion, placing it fourth among urban investment markets.

Economic Outlook and US Dollar Implications

• The US economy is expected to remain expansionary in the short term but may face contractionary pressures in the medium term.
• The US dollar is likely to remain strong in 2017, but could weaken in 2019 if a recession materializes.
• RMB depreciation concerns have driven Chinese investment abroad, particularly in the US and Hong Kong, but slower depreciation is expected in 2017, which may reduce such outflows.

Chinese Interest Set to Shift to Asia

• Mainland China dominates foreign property investment, with USD37.2 billion invested in 2016.
• Outbound investment (USD25.2 billion) is significantly higher than inbound investment (USD12.0 billion).
• Hong Kong is a key destination for Chinese investment, with USD6.6 billion invested in 2016.
• Chinese investors are drawn to Hong Kong due to its cultural proximity, political stability, and currency peg to the US dollar.

Key Asian Markets

• China remains the largest investment market, followed by Japan, Australia, Hong Kong, South Korea, and Singapore.
• Hong Kong and Singapore saw significant growth in 2016, with Hong Kong experiencing a 15% increase and Singapore a 38% increase in transaction volumes.
• India also showed strong growth, with a 253% increase in investment, but its total investment was relatively small compared to other markets.

Conclusion

The document concludes that while the long-term trend of Asian capital outflows persists, intra-regional investment has gained momentum, indicating increased confidence in the Asian property market. The US remains the primary destination for Asian capital, but the potential for RMB depreciation may shift investment interest back to Asia in the medium term. The economic outlook for the US is cautiously optimistic in the short term, but uncertainties around trade policy and immigration reform could lead to long-term challenges.