Overseas funds keep close eye on SAR market
Overseas funds from the United States and East Asia are looking for further investment opportunities in the SAR property market, according to Jones Lang LaSalle's head of investment.
Clara Chan said besides GRA - the most active overseas property buyer in recent months - other US investment funds were also looking at properties in Hong Kong.
Investors from Australia, Singapore and other East Asian countries were also scouting, she said.
Jones Lang LaSalle handled the latest big property transaction in Hong Kong for a fund managed by GRA - the $780 million deal for 20 houses in Shouson Hill Road East.
GRA is a Singapore-based company whose parent is Prudential Insurance Company of America.
Ms Chan said overseas investors were active property buyers in Hong Kong and would continue to be in the new year.
US investors were willing to purchase here because they felt US property market prices were high and US inflation pressure was increasing, she said.
Singapore's property prices have already returned to pre-Asian crisis levels while Hong Kong's are still lower than pre-crisis levels.
In this situation, Singaporeans would also feel there was potential in the SAR.
She added overseas investment funds' costs of funding were lower than that of local buyers.
On the other hand, local investors felt they still had enough land banks and would not be as keen to buy unless prices were low, Ms Chan said.
However, she expected more local end-users would step into the market next year as confidence was lifted by stock market rallies.
Some local players might buy office units, using half the space for lease and half for self-use, she said, adding the luxury market was constrained by a shortage of properties for sale.
However, some developers might be willing to sell top-end properties which had been held for lease for a long time to increase their profits on top of gains from selling new projects, she said.
THE OUTLOOK US investment funds scouting SAR Local interest remains fickle Shortage of top-end properties