Certain Asian markets, including India, remain attractive locations for commercial real estate investment
Despite the global economic slowdown, certain Asian markets, including India, has remained attractive locations for investors seeking out commercial real estate assets. Both rental and capital values have been indicating healthy increases in countries like Thailand, Hong Kong and China.
While the United Arab Emirates and the U.S. are also on the path of recovery, the European market is yet to see a positive light in this sector.
In India, macro-economic numbers for both industrial production and exports are showing a slightly better tone. The better pattern for realty markets in the country is visible in the investment market, which is also starting to filter through to the occupier side as well. In India, investment enquiries edged up and elicited a positive trend for the first time since 2011, according to the RICS Global Commercial Property Survey.
India has improved its overall global ranking by 10 places with respect to occupier demand and available space, ranking 9 in Q4 as compared to 19 in Q3 2012. While India still ranks behind Thailand, Hong Kong and China on these parameters, as was the case in the previous quarter as well, it has however improved its ranking considerably, as a consequence of which it has improved its performance over Japan.
On the investment side, enquiries have once again picked up pace during the last quarter of 2012. Both investment activity and prices are looking to be positive for the second consecutive quarter, with enquires for the office segment being the most pronounced, followed by the retail sector. Unfortunately, the trend for industrial space continues to remain negative for the second successive quarter. Overall India is ranked 7 globally in terms of investment demand expectations this quarter as compared to a dismal 22 rank in Q3.