Investors are showing more optimism in the real estate sector, according to a survey conducted by WTW.
Focusing on the findings from the companies surveyed that were from the Asia Pacific region (APAC), about 54% of the firms believed that the value of their assets will be increasing overall in the next two years. About 68% of them expected that they would see the improvement of rental rates, even when the market saw one of the deepest downturns in recent years.
“Despite the market headwinds, the real estate industry remains very energetic in addressing these, turning challenges into opportunity,” said Ben MacCarthy, head of real estate, hospitality and leisure, Asia at WTW.
About 60% of firms also reported that property technology was one of their greatest opportunities within the next two years, noting that proptech and AI may possibly be transformational.
“We found APAC firms pursuing innovative solutions through proptech, with a focus on SMART buildings and improving ways data is accessed accurately especially to adapt to ESG and climate regulations,” said MacCarthy.
However, 71% of the firms also stated that cyber threats were one of their greatest insurable risks, followed by public liability (68%) and geopolitical risk (65%).
While 55% said they were affected by climate-related loss, only 5% were confident that they had enough insurance to deal with possibly severe impacts from extreme weather events. About 63% said that they were uncertain if their insurance coverage was enough.
“The findings of this survey also underscore the need for a strategic approach to enhancing risk management strategies, ensuring comprehensive data access, and securing insurance coverage,” said MacCarthy.
“This becomes increasingly vital with the rise in frequency and severity of extreme weather events, growing cyber and geopolitical risks requiring a resilient and adaptable risk management framework.”
WTW’s Global Real Estate Risk Outlook Report involved the views of 350 companies all over the world, including property investors, asset managers, and pension funds.
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