Last week at the PERE Global Investor Forum San Francisco, on the panel Global Perspectives: Accessing Asia’s growth, with Christina Gaw from Gaw Capital, V Hari Krishna from CPPIB, and Joseph Fuqua from Sun Hung Kai. Some quick notes below.
Next decade: de-globalization as the underlying theme?
China going through distress (developers) but the high yields in bond markets do not immediately translate into distressed asset-level opportunities on the ground given domestic liquidity and state-owned players. "Regardless of how much distress there is in China, the question is can you access it?". A window of opportunity in attractive mainland-related offshore debt opportunities in HK, though.
India - a very different path, de-regulation of the economy the big theme for India; GDP growth vs demand/supply for capital as a source of investment opportunities; big demand for office, tech spend, despite WFH trends. "Leapfrog generation" for the office stock. Shift to cloud and demand for digital infrastructure. Starting from a low base.
Some global themes are consistent across Asia: digital infrastructure, data centers in China, India, Korea, Japan, HK, SG, but the local flavors may be very different. Digital sovereignty is a major factor. Opportunities in life sciences.
The composition of money flows and property users changes across the region but that doesn't necessarily change the nature of the asset.
A lot of interest in private debt, not unique to Asia. Highly complex to do in China now.
No lack of misperceptions, e.g. investors' concerns about the office sector and WFH - but in Asia's tiny homes in many markets, not fun doing WFH. As always, twists with the on-the-ground reality vs headlines.