APAC is home to three of the world’s four most populous nations (China, India and Indonesia) and growing rapidly. Prior to the global financial crisis offshore investors mostly pursued high risk property investments to capture the tremendous growth of the region. However, many investors achieved disappointing returns due to an underestimation of property investing risk within Asia’s emerging markets. However, we see a structural decline in investing risk within APAC’s high-income economies which is attracting low-risk overseas investors to the region; they are allocating capital to diversify as well as to potentially achieve higher returns than are available in their home market.

This paper outlines Asia Pacific’s investment landscape in terms of its historic return performance, its risk characteristics, and the size of the institutional property universe. We believe APAC’s high-income markets are a low risk means of accessing the growth of its emerging markets, as they urbanise and experience a catch-up in incomes with the industrialised west.