The GPR/APREA Asia Pacific Performance Snapshot tracks the dynamics of listed real estate securities (including REITs) across 12 Asia Pacific countries, and eight sectors over multiple time horizon.
The following asset classes are covered:
Listed real estate (including REITs): GPR/APREA Composite Index
Listed real estate indexed returns in the Asia Pacific crept up in June, as investors bought into a fledgling economic recovery on the back of easing lockdowns across the region. Real estate equities and REITs, with exposure to China, including those listed in Hong Kong and Mainland China are enjoying a resurgence as investor interest increased on bargain opportunities.
Hong Kong listed real estate equities and REITs rebounded 12.2% and 7.8%, respectively, in June, despite the start of a newly imposed national security law. Investors are looking past the debated legislation, opting to focus on renewed stability in the economy as social-distancing rules were relaxed.
Listed Real Estate/REIT indices continued to underperform the broader markets, and were down 18% and 21%, respectively from their peaks. However, with a majority of lockdowns easing across the economies, returns could once again outperform as businesses resume amid a slew of rate cuts globally.
Asia Pacific REITs outperformed the broader market in May against a backdrop of falling number of new COVID-19 cases and phased re-openings of the region’s economies. There continues to be a wide array of fiscal policy responses across the region including further subsidies to sectors most strongly impacted by social distancing policies and travel restrictions, as well as to small and medium-size enterprises (SMEs).
By sector, industrial remained the top performer, posting double-digit gains in May. By country, Australian real estate equities outperformed on the back of strong returns generated by the residential and industrial sectors.
Japan REITs led the region’s in May, mainly driven by the hotel and retail sectors. Japan's lower house of parliament approved an emergency budget that include rent subsidies for SMEs and thus bode well for the office sector. Singapore REITs were also an outperformer, buoyed by a solid performance of the industrial and retail REITs.
Australian real estate equities and REITs led the region, as retail rebounded and industrial sector remained strong. Additionally, investor sentiment has improved with the further easing of COVID-19 restrictions throughout Australia.
Singapore REITs also outperformed on the back of a rebound in hotel REITs and continued resilience in the industrial sector. Furthermore, the rally comes on the heels of the Singapore government’s announcement of a series of new measures to provide S-REITs with greater flexibility to manage their cash flows and raise funds.
China offshore REITs also performed well in April as domestic activity continued to gradually pick up. Notably, China launched a pilot scheme for REITs in the infrastructure sector on April 30, focusing on warehousing and logistics, toll roads and other transportation facilities, etc. as well as new infrastructure, national strategic emerging industrial clusters, high-tech industrial parks, and other thematic industrial parks.
