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MEDIA & MARKETING | Staff Reporter, Hong Kong
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Chinese mutual funds interested in Hong Kong property

Have over US$14 billion for overseas real estate investment.

Mutual funds held by Chinese insurers' asset management units are seeking overseas real estate in Hong Kong, said property adviser CBRE. The Chinese are also looking at Singapore and Malaysia among regional targets.

CBRE said prime high-end office properties in core international cities are highly sought after, considering the attractive yields they can produce in today's low-interest-rate environment.

Chinese institutional investors, however, are relative newcomers to cross-border real estate investment strategies compared to pension funds, insurance funds and sovereign wealth funds from other regions.

Chinese institutional investors have begun to increase investment in overseas real estate in recent years, a trend driven by limited investment channels in China’ abundant liquidity; the renminbi’s appreciation and the relatively lower valuation of overseas assets after the 2008 financial crisis.

In 2012, total assets of China's national insurance institutions stood at US$1.2 trillion. New regulations permit these institutions to invest up to 15% of their assets in "non-self-use" real estate. By this measure, there is in excess of US$180 billion available for real estate investment.

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