30 Sept 2007 /PRNewswire-AsiaNet/

Shanghai, Singapore and Tokyo rank as the three most promising Asia Pacific cities in terms of real estate investment prospects, according to Emerging Trends in Real Estate(R) Asia Pacific 2008, just published by the Urban Land Institute (ULI) and PricewaterhouseCoopers LLP. The three cities also received high ratings for development potential, reflecting their status as prominent global gateways.

ULI, based in Washington, D.C., is a global education and research institute dedicated to responsible land use; its ULI Asia district council serves the institute's growing membership in countries throughout Asia. The report, being released at a series of events in Asia over the next several days, provides an outlook on Asia Pacific real estate investment and development trends, real estate finance and capital markets, trends by property sector and metropolitan area, and other real estate issues pertinent to the countries in Asia. Twenty markets are included in the report. It is the second Asia Pacific edition of the highly regarded annual Emerging Trends in Real Estate(R) investor survey, which has covered United States markets for 29 years and European markets for five years. Based on the opinions of internationally renowned real estate professionals, Emerging Trends is one of the most respected and anticipated outlooks for the industry. The Asia Pacific version reflects interviews with and surveys of more than 190 professionals, including investors, developers, property company representatives, lenders, brokers and consultants. ULI Senior Resident Fellow Stephen Blank is presenting the report to Institute members during meetings in Tokyo, Singapore and Hong Kong. According to Blank, one change highlighted in Emerging Trends is the rising number of individuals and firms now active in more than one Asia Pacific market, indicating the business community's growing comfort level with operating in several cities offering widely varying market conditions. "It's clear that the Asia Pacific property market is still as diverse today as it was a year ago, in terms of opportunities, risks, capital markets, economics, demographics and business cycles," Blank said. "The fact that more businesses understand and recognize the diversity and variations is undeniably another step toward market maturity."

David Sandison, tax partner, PricewaterhouseCoopers in Singapore, acknowledged Blank's observations. "It is expected that even greater amounts of capital will be flooding Asia Pacific real estate markets in 2008. The real challenge for investors will lie in finding the right assets against the backdrop of yield compression and scrutiny by regional governments and tax authorities," he added. Sentiment was strong among survey participants to either buy or hold all types of properties in Shanghai, Singapore and Tokyo, rather than sell properties, illustrating the cities' strong popularity with the investment community.

Singapore received the highest rating of any of the cities included in the report in terms of overall risk. Singapore is "certainly one of the markets in the area that provides a very stable legal and tax environment, and property rights that are beyond question. And it therefore is certainly one of the markets where many, especially Westerners, are very comfortable," says one respondent. The strongest sentiment for buying in Singapore was in the apartment residential/rental sector, in which 53 percent of the respondents advised buying; while 34 percent advised holding. Less than 13 percent recommended selling apartment residential properties. Nearly 52 percent recommended buying office space, 29 percent advised holding, and 19 percent, selling. More than 48 percent recommended buying hotel space, 38 percent advised holding, and 13 percent, selling. In the retail market, 45 percent of the participants advised buying; 41 percent, holding; and 13 percent, selling. In the industrial/distribution sector, more than 44 percent recommended buying; nearly 48 percent, holding; and 14 percent, selling.