(Sept 24): BlackRock Inc will refrain from investing more in China’s real estate market until it sees a significant return in investor confidence and an improvement in supply-demand fundamentals for the property sector there.

“It feels like we are a long way away from actually investing in that market,” said Hamish MacDonald, head and chief investment officer of Asia-Pacific real estate at the world’s largest asset manager. “China’s not part of our investment strategy at the moment because we are not convinced of a deep liquid exit right now,” he said at a news briefing on Tuesday in Singapore. 

BlackRock has made commercial property investments in China in the past, including an office complex in Shanghai, which it has sought to sell at a discount, Bloomberg News previously reported.

MacDonald’s remarks, which came after China’s central bank announced a range of measures to boost the economy and real estate sector, underscore the struggle policymakers still face in regaining the confidence of global investors.

“I want to see offshore capital focusing on it, and I want to see domestic capital also buying, and at the moment there’s not a lot of buyers in either of those two categories,” MacDonald said, when asked about the impact of the stimulus on the real estate market. 

While “China’s not off the table” and things can change quickly, BlackRock is more interested in other property markets such as Australia, Japan and Singapore, he said. Clients are looking at the Asia-Pacific region to diversify their global portfolio, but “they’re not looking for additional risk,” he said.

Ben Hickey, BlackRock’s head of real estate in Australia, said at the same briefing that the firm is planning to invest about A$1 billion (RM21.87 billion) to A$1.5 billion to build a life sciences portfolio in the country, with a focus on acquiring assets in clusters at major cities like Melbourne and Sydney. 

The next 18 months will be “critical” for its deployment, MacDonald said.

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