The view then – and, to a degree, now – is that property should be a domestic asset and going offshore meant exposure to currency and geographical risks. WHEN Brett Ward started to think about investing in global property securities in 2001, it was a new concept challenging the conventional view of real estate investment.
After some research, he launched the AMP Global Property Securities Fund in September 2002. It met with early success, growing to $1 billion quite quickly thanks to support from Japanese institutions. Ward, then a young investment analyst who had taken over AMP Capital Investors’ Australian real estate investment team in 2000, felt differently.
Australia looks cheap. US-REITs are trading at a premium of 15 per cent to 20 per cent. In the last quarter last year, the listed US real estate sector became expensive (the US became progressively more expensive, in relative terms, during the second half of 2010). Similarly, Asia-Pacific as a region also looks cheap.
Rents are getting back to the peak levels of $HK200 ($24) a square foot. But the market expectation today is the Asian government policy process is going to continue and it will create volatility but the market is taking it more in its stride. If you look at commercial real estate, say, in the Hong Kong office market, it is very strong because of low supply almost island-wide. Commercial real estate in some of those centres has been quite strong and continues to perform well. These measures have largely affected residential property.
We are a research-oriented, bottom-up kind of manager. Of the 400 or so listed property companies and trust listed on the FTSE EPRA/NAREIT Developed index, covering 22 countries, our team of 18 real estate analysts focuses on about 250 companies. When we cover a company, our aim is to cover it in depth. We look for value.
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