JLL has revealed that Asia Pacific cities are still behind those in North America and Europe in terms of intensity of investment.
Despite the increasing popularity of Asia Pacific cities as global property investment destinations, only four cities in the region (Hong Kong, Tokyo, Melbourne and Sydney) managed to make into the top 30 according to JLL’s recent report.
“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.”
JLL’s Top 30 list 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.
While boasting huge investment potential, emerging world cities will need to boost transparency, improve regulatory oversight and build robust financial platforms in order to attract real estate investors in the long term, JLL said.
For Chinese cities such as Shanghai and Beijing, their opportunities for growth on property investment intensity are huge.
Joe Zhou, head of research for JLL China, said:
“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. 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.”