Property most popular investment among Asia's wealthy families: survey

Trophy buildings are the favourite real estate investment for wealthy Asian families despite concern the market in the region could be overheating, UBS says.

Investment allocation in real estate has grown to 16 per cent this year from 9 per cent last year, according to a report by research firm Campden Wealth that was commissioned by the Swiss bank and published yesterday.

Twenty-nine family offices across the region with managed wealth of a minimum US$200 million were interviewed about their investment allocation strategy and outlook for markets.

"The family offices expected they will increase their investment in real estate further, to 22 per cent, in three years' time," said Lau Yan, a managing director and head of family services at UBS Asia Pacific.

"For good quality real estate in prime locations, investors believe they won't be making a wrong decision if they buy, even if the price is sometimes too high."

Real estate investment saw the biggest asset allocation of all the region's markets and was particularly strong in Hong Kong, UBS said.

Lau said investors preferred assets which could be touched and seen, rather than being on paper like stocks and bonds, the issuers of which could go bankrupt overnight, after witnessing the market trough sparked by the global financial crisis.