Capital hesitant but Asia and Europe mutually attractive

The last decade has seen increased levels of interest in Asia among European investors and vice versa, according to Thomas Veith, Partner, Global Real Estate Leader, PwC.

“European capital wants to do more in Asiapac because the economic fundamentals are sometimes much more positive, especially in the current environment,” he told Real Asset Insight’s Richard Betts while attending a recent investment briefing in Singapore.

“If you follow the supply chain changes after the corona crisis, we see that a lot of European industrial companies diversify their supply chain so they are moving parts of their production away from China into Indonesia and Malaysia. That’s a trend which capital flows for real estate follow,” Veith explained

Development is rapid in  Indonesia and Malaysia which are likely to become centres for institutional capital in the future. European capital also likes the stability of interest rates in Japan.

In terms of Europe-bound capital flows, Europe is still on the agenda for Singapore-based investors but they need more clarity about the energy challenges that Europe faces. Asian investors also await the revaluation of the European real estate markets before investing there again.

Please click on the video above to watch the full interview or listen to the podcast below.