Investment momentum slows as market uncertainties arise
Total investment volume in Q1 2022 dropped 46% QoQ to HK$11.2 billion (US$ 1.4 billion), with over half of the deals completed being negotiated last year, which is before momentum started to slow with the introduction of more stringent social-distancing rules in late January. Yet, it still constitutes a 19% YoY increase due to the low base effect in 2021.
The industrial and retail sectors saw the highest volume of investment, while hotel assets witnessed increased interest after a quiet 2021 from investors looking for discounted pricing and value-add potential by converting into alternative use.
- Industrial assets expected to remain sought-after with solid demand for data centre and cold storage facilities
- Hotel transactions will increase given their ability to convert to alternative use
- Deals in the office sector delayed by Omicron are also expected to resume in H2