Reits and foreign funds chase industrial real estate

PUBLISHED : Wednesday, 15 March, 2006, 12:00am
UPDATED : Wednesday, 15 March, 2006, 12:00am

Demand for industrial real estate has intensified on the back of strong exports and an improved economy, with real estate investment trusts (reits) and foreign institutional players leading the charge.

Property consultant CB Richard Ellis said reports about reits dominated the headlines in the fourth quarter, following the launch of the Link Reit in November.

'Aside from the retail-focused Link Reit, all the reits currently under the spotlight hold industrial premises as key constituents,' the company said in its latest research report.

Four of the seven properties that made up the Prosperity Reit were industrial.

Reit-related interest in industrial premises was also seen among foreign institutions such as Macquarie Goodman, which acquired three industrial developments in Tsuen Wan and Tuen Mun last year.

Sun Hung Kai Properties is understood to be preparing for a reit listing of industrial-office buildings and industrial properties in Hong Kong such as Apec Plaza, Peninsula Tower, New Tech Plaza and Advanced Technology Centre.

Investors were also interested in industrial real estate in the mainland and the rest of Asia, the consultant said.

CB Richard Ellis said the spotlight had fallen on the logistics sector in the mainland, which was opened up to foreign ownership last December.

In Shanghai, overseas firms were searching for investment opportunities in income-producing industrial properties.

Macquarie Goodman, Mapletree and AMB had already made their first acquisitions in the city's industrial sector.


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