BEIJING Feb 5 LaSalle Investment Management
said on Thursday it had invested about 20 percent of a $3
billion property fund, mostly in Japan and China, but that it
was being very cautious in looking for buying opportunities.
LaSalle, the fund management arm of Jones Lang LaSalle
(JLL.N), unveiled the Asia "opportunity" fund in August, which
along with borrowing has up to $12 billion available to buy
distressed property in the region.
"There will be great opportunities," David Edwards,
LaSalle's Asia director, told reporters. "But we are not in a
great hurry to make investments at this point in time."
LaSalle, which has about $50 billion under management, has
invested in Japan than China, but was looking for opportunities
in Australia as well as Singapore and Hong Kong, said Edwards.
China's economy was still relatively strong compared to the
rest of the world, and because Beijing had been trying until
late last year to cool its robust growth, it still has many
tools to stimulate growth, the executives said.
"It can still create jobs, it can still fill office
buildings and it can still generate retail sales in a way the
West can not," said Jacques Gordon, international director for
However, the property price correction in China will come
slower than in other markets -- thus damping buying
opportunities -- as Beijing takes steps to soften the impact
from the global recession on the local economy, the executives
China will spend about half of its 4 trillion yuan ($585
billion) stimulus package on affordable housing through 2010,
and has also scrapped stamp duty for home buyers and sellers,
lowered downpayment requirements and reduced mortagage interest
Moody's downgraded on Thursday Greentown China Holdings
(3900.HK) corporate family rating to B1 from Ba3, and its
senior unsecured bond rating to B2 from B1. It was the second
downgrade by Moody's for the property developer in five months.
The operating environment in China remains very challenging
with poor sentiment and downward pressure on property prices,
which are hindering Greentown's ability to generate cash flow,
said the ratings agency.
LaSalle is recommending that investors take a defensive
stance, constructing a portfolio by taking on core assets or
buying property-related debt.
"The message we are sending our clients it to prepare for a
very tough year, and there will be more bad news before good,"
(Reporting by Kirby Chien; Editing by Kim Coghill)