Asia Pacific ViewPoint - Rethinking Alternative Asset Valuation: Challenges and Approaches
As Asia Pacific enters the late stage of the economic growth cycle, real estate investors are increasingly emphasising asset diversification and stability of income as their criteria move beyond traditional yield-based performance.
Alternative sectors such as data centres, multifamily residential and self-storage are gaining popularity among investors seeking income stability and higher returns, as well as a new dimension of enhanced returns from direct or indirect operational involvement.
However, the relative immaturity of alternative assets in the region poses a challenge for investors seeking to conduct due diligence and appraisals of property values. Many types of alternative assets have a brief history as an investment class, meaning that transaction records are limited. Cashflow can often be opaque, making it difficult to benchmark rents, income and other operational data.
This ViewPoint by CBRE Research and CBRE Valuation & Advisory Services explains the various challenges related to alternative asset valuation and provides guidance for investors seeking to understand approaches to appraising this complex asset class.