Institutional investors are allocating larger proportions of their portfolios to Asian real estate despite a global slowdown in the sector.
In particular, United States pension funds are boosting their stake in Asian real estate, according to the Asian Public Real Estate Association (APREA).
"In certain Asian markets such as Hong Kong and Singapore, real estate investment trusts (REITs) are beginning to mature as an asset class", APREA chief executive Peter Mitchell said.
Unlike the US economy, Asian economies are expected to rise, further driving the growth in the Asian REIT market, Mitchell said.
The California Public Employees' Retirement System (CalPERS) and the California Public Employees' Retirement System (CalSTERS) have increased their exposure to Asian real estate from 6 to 8 per cent in over a year, he said.
Last year CalPERS invested $1 billion of its portfolio in Asian real estate.
Australian investors are also moving into Asian property.
In January, the National Australia Bank took a 20 per cent in Chinese property trust, the Union Trust and Investment.
The bank's structured property finance business, nabCapital plans to expand further into Asia following demand from its clients.
nabCapital already has two people located in Shanghai, and will look to relocate three more people to the region.
"Our clients want us to take a more active role in sourcing opportunities in Asian real estate," nabCapital director of property institutional sales Hamish Roth said.
