By Benjamin Chow on January 22nd, 2020
After a year of sweeping changes for Asian outbound capital flows, South Korean investors took the top spot as the biggest Asian capital exporters in 2019. Their combined $17 billion worth of deals outside the Asia Pacific region was almost double their previous high in 2017.
The increase by South Korean players bucks the general trend in 2019 when overall global cross-border activity slowed and investors moved their focus closer to home. The other major capital exporters from Asia all scaled back their outflows into Europe, while Chinese flows outside of Asia collapsed to their lowest levels in a decade, exemplified by a 91% year-over-year decrease in investment to the U.S.
As a result, South Korean outbound capital made up almost half of all Asian outflows in 2019. The only other year when the Koreans emerged at the top was during the throes of the Global Financial Crisis, when the major Asian capital exporters all slashed their investments outside the continent.
Back in 2009, the National Pension Service of Korea ventured beyond Korean shores for the first time, picking up three London office properties for a combined £1 billion ($1.3 billion), and selling two of them for £1.3 billion within five years. Exactly a decade later, other Korean institutions are following in their footsteps with big-ticket office purchases in “new” territories from Luxembourg to Slovakia.
Deal activity figures for South Korean players will likely get a boost in 2020 too, with Mirae’s multibillion-dollar purchase of Anbang Insurance’s U.S. luxury hotel portfolio still in the pipeline.
Real Capital Analytics will report on market trends across Asia and Australasia in the next edition of Asia Pacific Capital Trends, which will be published February 4. If you are interested in learning more about RCA’s publications, data and tools, contact us.
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