Opportunities for real estate investors in North Asia

Asia, the world’s largest continent with 47 countries and approximately four billion people, has emerged as a major real estate investment destination in recent years. From a strategic standpoint, Asia provides higher long-term returns, diversification and unique opportunities driven by strong long-term demand, which is fuelled by fast growing economies, rapid urbanization, and increasing personal income.

Economic growth and urbanization naturally lead to a rising middle-income class. A growing population with disposable income results in greater demand for homes, schools, shopping centers, places of employment and leisure outlets.

However, at this point in time Mercer believes that only a handful of Asian countries (and territories) are suitable for private real estate investment. Asia accounts for 50% of the world’s population and slightly over 20% of the world’s economy and as such Mercer believes should be included in an investor’s portfolio. However, the countries are very different in size, wealth, and growth prospects (see Table 1) and this increases the complexities of investing. Overlay differing practices, conventions and investment environments and this clearly points to the need for careful due diligence of any investment proposal.

Jennifer Johnstone Kaiser
Head of Mercer's Real Estate Boutique, Asia Pacific

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