The Real Deal New York

Asian insurance funds could spend $75B on real estate

New York City to benefit from growing asset sizes and looser regulations

July 10, 2014 05:30PM

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Asian insurance funds set to increase foreign real estate investment

Asian insurance funds set to increase foreign real estate investment (Credit: Maurice Mayfield)

In the coming years, Asian insurance funds are set to increase their spending on overseas real estate by $75 billion, and New York City could be a major benefactor.

The projection comes from commercial brokerage CBRE, which bases its expectations on the relaxation of regulations that previously limited Asian insurers’ foreign investment. Countries such as China, South Korea and Taiwan have recently allowed overseas direct investment and given funds the green light to allocate more money to real estate overseas, World Property Channel reported.

At the same time, the size of Asian insurers’ assets is growing – up 13 percent from 2008 to 2013. CBRE believes the combination of relaxed rules and growing assets could help the funds grow their direct and indirect investment in foreign real estate from $130 billion last year to $205 billion in 2018.

There are also fewer investible real estate assets in Asia than in developed markets such as New York and London. Trophy assets in gateway cities are prime targets. [World Property Channel] – Tom DiChristopher

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