U.S. property firm sets up Asian wing

U.S. property firm sets up Asian wing

SINGAPORE (AFP): U.S.-based property consultants Jones Lang LaSalle Inc's investment management arm will set up an Asian wing here to act as a conduit for investments into and out of the region.

Christopher Brown, executive chairman of Jones Lang in Asia Pacific, said Thursday the Asian unit would be launched early 2000 for Asia-Pacific investors eager to expand their investments and for European and American investors seeking opportunities in the region.

LaSalle Investment Management Asia hopes to raise up to US$600 million by the first year of operations for investments in the real estate and property securities markets.

The decision to set up the Asian operations here was influenced by the regional economic recovery, said Yu Lai Boon, Jones Lang's associate director of research and consultancy.

There was potential for growth in the region as there had been an outflow of funds from Asia-Pacific to Europe and North America during the financial crisis which hit the region in mid-1997, he said.

With the recovery, investor confidence was returning, he said.

"The problems for the last two years, I don't think it has changed the fact that Asia will be the growth sector for the next 20, 30 years, so investors want to be part of that," Brown said.

LaSalle Investment Management Asia will be raising capital from investment companies, state pension funds and insurance firms among others.

Brown told AFP that although property markets in Asia were recovering, property prices had not returned to pre-crisis levels.

But, this was "a very good time" to start entering the regional property market "before they get to the top of the value," he said.

Brown described as stable the property markets in Singapore and Japan and reasonably stable the market in Hong Kong.

The Thai market was undergoing "some extent" of recovery while the recent government change in Indonesia brightened hopes of a turnaround in the Jakarta market, he added.

"A long period of stability is good because then it gives you time to search around for the opportunities to really do due diligence and assess the viability of various dues that come on the market," Yu said.

Jones Lang is a leading real estate services and investment management firm with 1998 revenues of $848 million.

La Salle Investment Management has more than $20.9 billion in property worldwide.