Real estate fund managers have started raising Asian money to buy into London residential and United States commercial properties when the two markets show clearer signs that recoveries are well under way.
Among the Hong Kong-based funds positioning themselves to make an entry into the US market when the timing is right is real estate private equity fund management firm Gaw Capital.
'We are not really raising a US fund as such. It is rather just a club of investment partners formed among a bunch of friends and family members from Asia to purchase US property-related debt and properties,' said chairman Goodwin Gaw.
'The US market is unlikely to recover in the short term, but I do think the bottom is close if not already there,' he said.
In a recent Korpacz Real Estate Investor Survey commissioned by financial consultancy PricewaterhouseCoopers, property professionals say they believe that the recovery of commercial real estate in the US is not expected to gain much traction until 2011 or 2012, given current prospects for a lacklustre revival in the economy and associated high unemployment. Rental rates will continue to decline until strong, consistent job growth resumes, according to the fourth-quarter survey.
More than 100 real estate investors were surveyed, representing real estate investment trusts, pension funds, private equity firms and insurance and mortgage companies.