A recent survey of major Asian real estate funds and companies, both public and private, conducted by The Asia Pacific Real Estate Association (APREA), suggests that exposure to European banks is very low, providing reassurance to investors against a backdrop of turbulence in Europe.
APREA, the leading Asian industry association which represents and promotes the real estate asset class, surveyed approximately 100 real estate funds and companies across the region and asked them about their exposure to European banks. A significant majority have no European bank debt at all. For those with any, the limit of those surveyed tends to be around 5% of total debt facilities, with a handful having exposure of around 15%, and with very few respondents saying their European debt exposure was any higher than that.
Peter Mitchell, Chief Executive Officer of APREA said, “There has recently been some speculation about the extent to which Asian real estate might be exposed to borrowings from European banks and therefore the extent to which there might be contagion from the ongoing uncertainty in Europe. We recognized that investors in Asia may be concerned and felt that it was important to establish a clearer picture on the exposure to European banks amongst Asian real estate funds and companies. It is reassuring to see the results and we hope that it helps investors to retain their confidence in this sector.”