New Zealand Commercial Design Trends Series NZ Commercial Design Trends Vol. 30/6 - Page 30

rebound has seen returns outpace almost all other Asian economies in the ensuing years. Like Korea and Taiwan, Hong Kong’s close ties to mainland China helped drive stronger domestic growth, which again supported office returns. Unlike Hong Kong, returns in the remaining Asian markets bottomed out in 2009, or 2010. The return profile of the Australian, New Zealand and Singapore markets followed a similar trend during the crisis, while Japan suffered the largest falls of any Asian market, and also posted the weakest recovery. These markets were generally more exposed to western capital markets and thus were more vulnerable to the downturn. In Japan’s case, an aging population has been a long-standing problem that drags its economic growth. Figure 2 examines the relationship between property returns and the macroeconomy and how this varies across regional markets. Over the period 2006 to 2012, office markets in Asia generally outperformed the local economy, but those markets with the strongest underlying domestic growth witnessed the best performance. Overall, Asian office property markets were fairly resilient during the financial crisis. Returns in most markets were impacted, but not to the same extent as markets in North America and Europe. Where returns in Asian office markets did enter negative territory, the contraction generally lasted less than a year, with most markets rebounding to some extent due to an inflow of capital seeking the high returns 28 SEARCH | SAVE | SHARE AT Below left:The Hong Kong skyline will continue to change over the next six years, but many office towers will be in new hotspots. Shown here is Gateway Towers in Kowloon. Below:Shanghai Tower will deliver much needed supply to the Pudong office market in China, when it reaches completion in 2015. Right:Platinum Park is a distinctive new integrated development in Kuala Lumpur designed by leading UK firm Foster + Partners. Figure 2: on offer from Asian office property. The data used in this article comes from IPD’s Pan-Asia Return Indicator (PARI), which contains data for more than 4000 assets in nine countries worth over US$270 billion. These assets cover a broad range of commercial property types from 2006 to present. For more information, visit save | share Search 44083 at