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Places that are favored by global property investors

ASIA Pacific cities have yet to catch up with their European and North American counterparts when it comes to intensity of investment despite their ever-increasing popularity as global real estate investment destinations, according to a latest report released by international property services provider JLL.

Only four cities in the region -- Sydney, Melbourne, Hong Kong and Tokyo -- managed to make into the top 30 list, which ranks world cities by comparing the volume of direct commercial real estate investment in a city over a three-year period relative to its economic size.

The four cities ranked 8th, 16th, 28th and 30th, respectively, according to JLL's latest Investment Intensity Index.

"Although the emerging cities of Asia Pacific are attracting an ever greater share of global real estate investment, our latest index shows there is some way to go before they punch their weight in terms of investment intensity," said Megan Walters, head of research for JLL Asia Pacific. "The balance is starting to shift, however, as real estate investors are looking more and more to developing cities to satisfy their diversification requirements."

An estimated 60 percent of the global office development pipeline until 2020 is projected to come from emerging markets, according to JLL's data.

While boasting huge investment potential, emerging world cities will need to boost transparency, improve regulatory oversight and build robust financial platforms to attract real estate investors in the long term, JLL said.

For Chinese cities such as Shanghai and Beijing, their opportunities for growth on real estate investment intensity are immense.

"Shanghai and Beijing have been identified as some of the world's fastest growing city economies and are making their mark globally as real estate investment destinations," said Joe Zhou, head of research for JLL China. "These cities sit consistently in the top 30 in terms of absolute real estate investment volumes, though they have not yet broken into the top tier of the Investment Intensity Index. This highlights an immense opportunity for growth."


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