Singapore joins ‘highly transparent’ real estate market ranking, surpasses Hong Kong

Hong Kong came in 15th in this year’s survey with a score of 1.97, a slight improvement from 1.98 in 2022, but missing the cut-off for the top-tier markets. Tier-1 cities in mainland China were among the most-improved markets in terms of transparency, it noted.

Chicago-based JLL launched the Global Real Estate Transparency Index in 1999. It classifies a score below 1.96 as “highly transparent” and 1.97 to 2.65 as “transparent.” A lower score suggests greater clarity and transparency in the market. The cut-off in 2022 was sub-1.97.

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The ranking assigns specific weights to several measures including performance, regulatory and legal policies, market fundamentals, transaction process, corporate governance and sustainability efforts.

“The focus on transparency for investors has never been greater as external challenges such as geopolitical tensions and election cycles draw increased attention,” Richard Bloxam, CEO for capital markets at JLL, said in a statement. “Additional drivers like artificial intelligence and higher standards of sustainability obligations and reporting will continue to push investors to seek greater transparency.”

The latest survey cited Singapore’s industry transformation map, which envisions a real estate agency that is professional, productive and resilient. It requires publicly-listed issuers to report and file annual climate-related disclosures by 2025, which are aligned with benchmarks set by the International Sustainability Standards Board.

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“This top set of countries has attracted over US$1.2 trillion in direct commercial real estate investment over the last two years, over 80 per cent of the global total,” according to JLL. “And with the lowest risk and highest levels of transparency around demand and pricing dynamics, in particular for growth property sectors, they are positioned to lead the cyclical recovery in liquidity as capital markets activity increases.”

Countries with transparent pricing and fundamentals, especially across the diverse range of specialty sectors and sub-sectors, are likely to lead the real estate liquidity recovery, said Brian Klinksiek, global head of research and strategy at LaSalle Investment.

“Diversification will be critical as the investible universe continues to expand in terms of breadth and complexity,” he added.

Several major markets that have made progress and are focused on enabling higher levels of institutionalisation offer strong long-term prospects, the survey showed, citing India, mainland China’s leading cities, South Korea, UAE and Saudi Arabia as examples.

“These markets will require a significant expansion of urban infrastructure over the coming decade but have collectively received only 6 per cent of global investment since 2022, highlighting the scale of opportunity as transparency improves further,” it said.