Chinese insurance companies have only been allowed to invest in real estate since 2009. Further deregulation in 2012 allowed investment in overseas markets and today overseas investment can be up to 15% of total asset value.
Current holdings of investment properties for all Chinese insurance companies totals USD13.4bn, an allocation of 0.8%. Just under half of this (USD6bn) we estimate is held overseas. The top five insurers have an allocation of under 2% underscoring the potential for rapid growth.
Allowing a full allocation could see an additional USD240bn deployed. Practically we foresee average allocations rising to near 5% by 2019, equivalent to an additional USD73bn of investment. This could increase by a further USD75bn by 2024.
Whilst the initial wave will be led by the larger insurance companies, we expect smaller sized companies to follow as they build teams to invest directly.
Source : Cushman & Wakefield