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The Rise of Real Estate Alternative Investments

Gabrielle Kartyasa

Article posted by Cobalt Recruitment

The Cobalt Real Estate team had the pleasure of attending the APREA AsiaPac Real Estate Horizons event earlier this month. The event had notable keynote speakers such as Nick Wilson (Research Director of Capital Markets, JLL) and Ling Yan Teo (Manager – Asian Fund Managers, Preqin). Following that, a highly informative Q&A session moderated by Peter Verwer (CEO – APREA) with distinguished panellists:

  • Alan Miyasaki
  • Andrew Heithersay
  • Joachim Kehr

We found the discussion very informative and gave all the attendees an insight of the opinions of industry leaders and experts. I found the topic of the shift to alternative investments particularly interesting and wanted to share what I believed to be the key takeaways from this session.

The first half of 2018 has been a very optimistic year for real estate investments in the region. While investment platforms invest into opportunistic and value-add funds, the alternative investments are becoming a new favourite, especially for institutional investors. The limited supply for new commercial and retail real estate resulted in the inflated price for core real estate, thus prompting investors to invest in other markets or sectors. Additionally, real estate alternative investments are less likely to be affected by the trends affecting core real estate, therefore offering the opportunity to add a new cashflow stream that enhances the entire portfolio performance.

Trend Drivers of Alternative Real Estate Investments

Aging Population - According to Asia Development Bank, Asia is on track in the next few decades to become the region with the oldest population in the world. Declining birth rates and increasing life expectancy prompts the demand for nursing homes, senior homes especially for Japan, South Korea, Thailand and China.

Globalization and population growth – Asset classes such as affordable housing, education, student accommodation and childcare stand to benefit from the growth of urban population, especially in Asia Pacific. Moreover, with globalization we see international schools sprouting as local aspirational parents seek out a reliable pathway for their children’s undergraduate education abroad.

Technology - Smartphones, smart homes, Artificial Intelligence, Internet of Things (IoT) - connectivity has simply changed the way we work and live. This will bolster the need for data centres, in which it is a critical facility that runs 27/4. As such, data centres will not be easily moved once deployed, thus making it attractive to investors for the long-term lease potentials.

Investors are optimistic these trends are for the long-term and they are looking to achieve economies of scale to institutionalize. Therefore, we see that investment in alternative real estate will continue in the long-term.

Article written by Gabriella Kartyasa, Real Estate Recruiter at Cobalt Recruitment

If you wanted to discuss this alongside seeking advice on your career or any current career opportunities please email me.

Meet the Cobalt Real Estate Team

Marcus has over 12 years of recruitment experience with Cobalt Recruitment in Europe, Singapore and Asia in general. Marcus now leads the Cobalt Singapore office having opened it in 2012 and works on specialist client mandates and senior retained searches.

Simin has been with Cobalt’s Real Estate practice for over 5 years now having graduated from NUS with a Bachelor’s Degree in Real Estate. She first learned her property expertise with Far East Organisation before moving to Cobalt to help to continue the growth of our Real Estate Team. Simin leads on roles such as investment and asset management, fund and portfolio management as well as leasing, development, property management and operations. An expert in sourcing outstanding passive candidates, she works with both local and international real estate developers, investors, funds and REITs working on mid-to-senior level appointments.

Wei Yolk is with our Real Estate practice, having worked in the industry after graduating from NUS with a Bachelor’s Degree in Real Estate. She has completed an industrial attachment with CBRE while at NUS and joined its investment sales team upon graduation. She then went on to work for a local developer as an investment analyst. Prior to joining Cobalt, Wei Yolk worked for a leading international recruitment firm in the Financial Services practice and she has placed several senior roles with top international bulge bracket banks. She has since gone back to her real estate roots and has successfully placed senior roles such as Head of Investments, Investments Director and Head of Asset Management with leading PERE funds and real estate developers.

Gabriella is an ex-industry expert on the Real Estate practice in Cobalt. She graduated from Monash University in Marketing & Econometrics and went on to join JLL in Jakarta, whereby she gained first-hand industry experience in the RE Markets department. She then joined a leading international recruitment firm to launch their Property & Construction recruitment arm in Jakarta and has successfully placed professionals into both commercial and technical roles in Singapore and Jakarta. Gabriella now works on investment, capital markets and consultancy positions across Singapore, Indonesia and South East Asia

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