Home • PRRES Inc. Journal • Read the Journal

The Impact of the Global Financial Crisis on Commercial Property Investment in Asia

Author/s: Graeme Newell, Muhammad Najib Razali

Date Published: 1/01/2009

Published in: Volume 15 - 2009 Issue 4 (pages 430 - 452)

Abstract

Commercial property investment in Asia has taken on increased importance in recent years. However, the global financial crisis of 2007-2009 has had a major impact on global property markets, including the Asian property markets. This paper examines global commercial property transactions in 2007-2008 to assess the impact of the global financial crisis on commercial property investment in Asia. Major property investor profiles and property transaction locations are also assessed. Clear differences emerge regarding the relative impact in Asia, both in a global context and regional context. The results highlight the increased relative contribution by the Asian property markets across a range of property investment characteristics during the global financial crisis. Issues relating to the ongoing impact of the global financial crisis over 2009-2010 are also highlighted.

Download Full Article

Download the Full Article PDF

14445921.2009.11104290.pdf 14445921.2009.11104290.pdf (155kB)

Keywords

Asia - Global Financial Crisis - Investor Profiles - Location Analysis - Property Investment - Relative Impact

References

  • Asian Public Real Estate Association (2009) Weekly Asian REIT Report: January 2009, APREA.
  • Bond, S., A. Karolyi and A. Sanders (2003) International real estate returns: a multifactor, multicounty approach, Real Estate Economics, 31, 481-500.
  • Chau, K.W., B. MacGregor and G. Schwann (2001) Price discovery in the Hong Kong real estate market, Journal of Property Research, 18, 187-216.
  • Chau, K.W., S.K. Wong and G. Newell (2003) Performance of property companies in Hong Kong: a style analysis approach, Journal of Real Estate Portfolio Management, 9, 29-44.
  • Chin, W., P. Dent and C. Roberts (2006) An exploratory analysis of barriers to investment and market maturity in Southeast Asian cities, Journal of Real Estate Portfolio Management, 12, 49-58.
  • Conover, M., S. Friday and S. Sirmans (2002) Diversification benefits from foreign real estate investment, Journal of Real Estate Portfolio Management, 8, 17-26.
  • European Public Real Estate Association (2009) Global Real Estate Universe, EPRA News, 27, 60.
  • Gray, L. (2009) Asset values take a hit, Institutional Real Estate Letter-Europe, July/August.
  • Hoesli, M., J. Lekander and W. Witkiewicz (2004) International evidence on real estate as a portfolio diversifier, Journal of Real Estate Research, 26, 165-206.
  • Jin, C., T. Grissom and A. Ziobrowski (2007) The mixed-asset portfolio for Asia-Pacific markets, Journal of Real Estate Portfolio Management, 13, 249-256.
  • Jones Lang LaSalle (2008) Real Estate Transparency Index, JLL.
  • Jones Lang LaSalle (2009) Asia Pacific Property Digest Q1:2009, JLL.
  • Ling, D. and A. Naranjo (2002) Commercial real estate return performance: a crosscountry analysis, Journal of Real Estate Finance and Economics, 24, 119-142.
  • Liow, K.H. (2000) The dynamics of the Singapore commercial property market, Journal of Property Research, 17, 279-292.
  • Liow, K.H. (2001a) The long-term investment performance of Singapore real estate and property stocks, Journal of Property Investment and Finance, 19, 156-174.
  • Liow, K.H. (2001b) The abnormal return performance of Singapore property companies, Pacific Rim Property Research Journal, 7, 104-112.
  • Liow, K.H. (2007) The dynamics of return volatility and systematic risk in international real estate security markets, Journal of Property Research, 24, 1-29.
  • Liow, K.H. (2008) Financial crisis and Asian real estate securities market interdependence: some additional evidence, Journal of Property Research, 25, 127-155.
  • Liow, K.H. and A. Adair (2009) Do Asian real estate companies add value to investment portfolios, Journal of Property Investment and Finance, 27, 42-64.
  • Liow, K.H. and M.C. Sim (2006) The risk and return profile of Asian real estate stocks, Pacific Rim Property Research Journal, 12, 283-310.
  • Macquarie Securities (2009) Global Property Securities Analytics: December 2008, Macquarie Securities.
  • Newell, G. and K.W. Chau (1996) Linkages between direct and indirect property performance in Hong Kong, Journal of Property Finance, 7, 9-29.
  • Newell, G., K.W. Chau and S.K. Wong (2004) The level of direct property in Hong Kong property company performance, Journal of Property Investment and Finance, 22, 512-532.
  • Newell, G., K.W. Chau and S.K. Wong (2009) The significance of Chinese commercial property in an Asian property portfolio, Journal of Property Investment and Finance, 27, 102-119.
  • Newell, G., K.W. Chau, S.K. Wong and K. McKinnell (2005) Dynamics of the direct and indirect real estate markets in China, Journal of Real Estate Portfolio Management, 11, 263-279.
  • Newell, G., K.W. Chau, S.K. Wong and K. McKinnell (2007) Factors influencing the performance of Hong Kong real estate companies, Journal of Real Estate Portfolio Management, 13, 75-86.
  • Newell, G. and R. Kamineni (2007) The significance and performance of real estate markets in India, Journal of Real Estate Portfolio Management, 13, 161-172.
  • Ooi, J., G. Newell and T.F. Sing (2006) The development of Asian REITs, Journal of Real Estate Literature, 14, 203-224.
  • Real Capital Analytics (2009), Global Capital Trends: April 2009, RCA (and miscellaneous previous copies).
  • Schwann, G. and K.W. Chau (2003) News effects and structural shifts in price discovery in Hong Kong, Journal of Real Estate Finance and Economics, 27, 257-271.
  • Sing, T.F. and S.H. Low (2000) The inflation-hedging characteristics of real estate and financial assets in Singapore, Journal of Real Estate Portfolio Management, 6, 373-386.
  • Global Property and REIT Report: 4 Quarter 2008
  • Transparency International (2008) Corruption Perception Index 2008, TI.
  • Wilson, P., S. Stevenson and R. Zurbruegg (2007) Measuring spillover effects across Asian property stocks, Journal of Property Research, 24, 123-138.
  • World Economic Forum (2008) Global Competitiveness Report 2008-09, WEF.
  • World Federation of Exchanges (2009) 2008 Annual Report, WFE.