Institutional Investors Positive About Property

A large majority of institutional investors are expecting the global real estate sector to pick up in the coming years. According to the recent JP Morgan Asset Management survey, a number of speculators are now allocating a proportion of their portfolios to alternative assets....

A large majority of institutional investors are expecting the global real estate sector to pick up in the coming years. According to the recent JP Morgan Asset Management survey, a number of speculators are now allocating a proportion of their portfolios to alternative assets.

Of these, real estate currently enjoys the largest market penetration, with 56 per cent of all respondents investing or planning to invest in the asset class. However, this has fallen from 71 per cent 2007. JP Morgan claims that this is likely to be a result of a "disappointment in returns" over the last 12 months.

However, investors were optimistic about the outlook for real estate and expect an improvement in real estate returns over the next two to three years. From a regional perspective, investors revealed that they were expecting the strongest returns in alternative assets to come from emerging Asia.

Peter Ball, head of UK institutional business at JP Morgan Asset Management, concluded: "The positive outlook for emerging Asia shows that investors are increasingly confident in seeking opportunities further away from home, a view which I believe demonstrates the increasingly global investment view adopted by UK pension schemes."

- Thursday 30 September 2010

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