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Tag: student housing

  • Hong Kong Family Offices Drive 16% of Commercial Property Deals

    Hong Kong Family Offices Drive 16% of Commercial Property Deals

    Hong Kong family offices and ultra-high-net-worth investors generated 16 per cent of commercial property transactions year-to-date, up sharply from 9 per cent in 2025, according to Knight Frank. The brokerage reported that hotel deal volume hit HK$11.3 billion (US$1.4 billion), nearly doubling the HK$6.3 billion recorded across all of 2025.

    Private capital accounts for 24 per cent of deals in hotels and student accommodation as buyers target repriced hospitality sites alongside deeply discounted prime offices. According to Ken Peng, chief investment officer at Raffles Family Office, an expected 0.25 percentage point interest-rate increase by the US Federal Reserve in December will do little to curb outbound or local acquisitions.

    Colliers head of capital markets Thomas Chak noted that local dynasties often deploy funds through direct equity structures or high-dividend real estate investment trusts. Rather than pausing for higher borrowing costs, wealthy families continue allocating capital across Hong Kong, Japan, Europe and the United States.

    Cash Flow Drives Conversions in Hong Kong

    Local buying has concentrated on discounted hospitality and office assets suited for conversion into long-term rentals or student housing. Rising university enrolments and a persistent shortage of purpose-built student beds allow operators to lock in rental cash flows nine to twelve months in advance. Repriced hospitality assets offer quicker turnaround times than ground-up residential builds.

    Deeply discounted prime office buildings are also drawing private equity groups and family syndicates capable of absorbing vacancy without bank pressure. Single-family offices representing established local dynasties often hold assets through direct equity structures or high-dividend real estate investment trusts. Alternatively, legacy properties acquired decades ago at minimal cost basis remain locked away for long-term rental income.

    Capital Targets Japanese Hospitality and Tokyo Offices

    Beyond the domestic market, Hong Kong private capital has targeted Japan as its primary Asia-Pacific destination. Cross-border funds have concentrated heavily on Japanese hotels and hospitality assets, alongside core office developments in Tokyo. Australia and New Zealand represent secondary targets for regional diversification, providing established legal protections and steady yield profiles.

    Western gateway cities in Europe and the United States continue to absorb wealth from families seeking portfolio dispersion. Most Hong Kong family offices hold minimal local domestic real estate relative to their net worth, preferring trophy commercial and residential holdings in cities where family members live, study or maintain corporate branches. This structure shields multi-generational portfolios from single-market regulatory shifts.

    use Risks Surface Under Prolonged Borrowing Costs

    A quarter-point rate hike in December will have limited impact on unencumbered buyers, yet sustained elevated rates create pressure for overleveraged property owners. Debt-financed commercial operators face refinancing gaps as lenders write down collateral valuations. That pressure creates acquisition pipelines for cash-rich family offices hunting distressed office assets across regional hubs.

    Federal Reserve policy shifts could cool rate pressures by 2027 if US economic growth moderates and fiscal policy tightens following legislative shifts. Until monetary policy reverses, institutional funds with high borrowing costs remain constrained, leaving private family offices to dominate off-market commercial disposals.

    Hong Kong commercial real estate deals closed 2025 with HK$6.3 billion in hotel volume before private capital stepped up conversion activity early this year. Attention now turns to the Federal Open Market Committee meeting in December, where Fed officials have indicated they may raise interest rates.

  • Greystar Appoints Tom Livelli to Run $3.9 Billion Asia-Pacific Living Portfolio

    Greystar Appoints Tom Livelli to Run $3.9 Billion Asia-Pacific Living Portfolio

    Greystar has appointed former EQT partner Tom Livelli as head of Asia Pacific. He will run a $3.9 billion living-sector portfolio across four regional markets.

    Based in Sydney, Livelli takes up the executive director post in early 2027. He will direct roughly 250 staff managing more than 11,500 rental apartments and student beds across Australia, Japan, South Korea, and mainland China. He replaces Adam Pillay, who has left the firm.

    Executive reshuffle across regional markets

    Livelli spent the past three years in Madrid as head of living strategies for Europe at EQT Real Estate. Before that, he built Greystar’s South American operations between 2017 and 2023. That expansion took the platform past $800 million in assets across 19 investments, alongside eight management contracts covering roughly 6,000 units. His earlier career includes tenures at Boston Andes Capital and Clark Realty Capital.

    The leadership change puts Livelli in charge during a regional shift toward residential formats. Institutional investors across Asia-Pacific have pulled capital from secondary offices and speculative logistics. They are targeting cash-generating living assets instead. Livelli must now consolidate operations and reallocate equity across the firm’s living formats.

    Pivot to purpose-built student beds

    Capital has flowed directly toward Australian student housing. In April 2025, the firm completed its largest deal in the region to date: an A$1.6 billion ($1.1 billion) buyout of a 5,662-bed student portfolio from Singapore sovereign fund GIC and Wee Hur Holdings.

    Student housing offers immediate rental indexation and counter-cyclical cash flows. Pure-play multifamily developments struggle to match those returns under current construction costs. Student accommodation also brings faster tenant turnover and flexible rate adjustments, providing a stronger inflation hedge than multi-year commercial leases.

    Pruning industrial sites and rental developments

    Greystar has simultaneously stepped back from other property sectors in the region. It wound down an Australian infill industrial drive launched in 2022, selling a Sydney logistics development plot to Gateway Capital for A$78 million ($55.9 million) in May 2026.

    Traditional build-to-rent projects have faced similar pruning. Warburg Pincus-backed Kio Investment Management recently acquired a former Greystar development site in Melbourne’s Collingwood neighbourhood. In Japan, Greystar put several apartment assets on the market to test institutional liquidity.

    Expansion in Seoul and regional funds

    The manager first entered Asia-Pacific in 2017 through a partnership with Macquarie Capital. Over the next nine years, it opened six offices across the region. Growth has since expanded beyond Australia and Japan into mainland Asia.

    In May 2025, the group recruited former Samsung SRA Asset Management executive Junghwan Kang to launch its South Korea platform. Around the same time, the Teacher Retirement System of Texas allocated $25 million to the manager’s Asia-Pacific value-add vehicle.

    When Livelli takes over in Sydney in early 2027, the focus shifts to execution. The firm faces decisions on whether to deploy fresh capital into Korean residential assets or accelerate divestments across its Japanese apartment holdings.

  • Southeast Asian Buyers Lead Hong Kong Commercial Property Inflows with HK$3.37 Billion

    Southeast Asian Buyers Lead Hong Kong Commercial Property Inflows with HK$3.37 Billion

    Southeast Asian investors spent HK$3.37 billion on Hong Kong commercial property this year, overtaking mainland Chinese buyers as the city’s largest source of non-local capital.

    The capital injection represents over 11 per cent of the HK$30.36 billion recorded across commercial transactions above HK$50 million so far in 2026, according to transaction data compiled by Savills. Local Hong Kong capital generated HK$25.25 billion, or 83.2 per cent of the total, while mainland Chinese buyers accounted for HK$1.75 billion, representing 5.8 per cent.

    Singaporean groups drove the bulk of the cross-border activity across three distinct profiles: corporate occupiers, private family capital, and specialized accommodation operators. DBS Bank Hong Kong completed the largest corporate transaction, paying HK$2.62 billion for 152,000 square feet across several floors at The Center. In Tai Kok Tsui, Wee Hur Holdings acquired One Bedford Place, an office property measuring 184,041 square feet, for HK$748.8 million.

    Repurposing Commercial Assets for Living Sectors

    Operator capital is targeting conversion opportunities rather than traditional office leasing. Centurion Holdings provisionally agreed to purchase Yan Wo Building in North Point for HK$364 million under a deal registered on August 25. Outside commercial zoning, private vehicle The Style Limited, backed by Singapore directors Luk Kwok Wing and Wee Teng Yuan, paid nearly HK$1.17 billion for the 30-unit luxury residential enclave Jadebeach Villa in Chung Hom Kok.

    Both Wee Hur and Centurion run purpose-built student accommodation platforms across Singapore, Australia, and the UK. Their entry into Hong Kong relies on the government’s Hostels in the City policy, which permits landlords to convert commercial properties into student housing without individual planning approval while retaining existing gross floor area.

    Displacement of Mainland and Western Funds

    This pattern marks an outright reversal of the regional capital hierarchy. Mainland Chinese and Western institutions previously dominated large-ticket transactions in the city, but their deployment has ground to a halt as balance-sheet distress and high debt costs keep them on the sidelines.

    For retailers, hospitality operators, and institutional landlords, Singaporean capital brings operational expertise in managing high-density living spaces rather than speculative office plays. The primary risk sits in execution: commercial conversions carry structural limitations, and returns hinge on sustained non-local student arrivals rather than corporate tenant expansion.

    Resetting Asset Valuations

    Last year, mainland Chinese buyers topped all non-local investors with HK$16.06 billion, or 34 per cent of the HK$47.32 billion total transaction volume. Investors from the United States and Canada deployed HK$7.58 billion, or 16 per cent, while European buyers spent HK$940 million. Southeast Asian capital ranked third in that period at HK$1.74 billion.

    “Pricing has reset far enough for buyers without legacy Hong Kong exposure to underwrite assets that local owners are having to release,” said Nicholas To, senior associate director for investment at Savills Hong Kong.

    The next metric to monitor is the conversion velocity of Yan Wo Building and One Bedford Place as developers test final yields against the government’s expanded 50 per cent quota for non-local university admissions.