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Macau, 14 July 2016 – Hong Kong ranks 15th most transparent real estate market in the world, according to JLL's Global Real Estate Transparency Index (GRETI) 2016. It remains as one of the most transparent real estate markets in Asia.
JLL's Global Real Estate Transparency Index, covering 109 markets worldwide, reveals which countries provide the most favourable operating environments for investors, developers and corporate occupiers. It quantifies transparency based on 139 variables relating to transaction processes, regulatory and legal frameworks, corporate governance, performance measurement and data availability. Higher real estate transparency is associated with stronger investor and corporate real estate activity.
UK remains the top transparent real estate market in the world, based on the index. The ten countries identified as 'Highly Transparent' by GRETI account for 75% of global investment into commercial real estate, which shows how important of transparency in real estate investment.
Australia continued to hold the top spot as the most transparent real estate market in Asia Pacific. Hong Kong and Singapore (11th) remain neck and neck for the top spot in Asia, whilst Taiwan (23rd) has moved into the 'Transparent' category for the first time.
Although Hong Kong remains as one of the region's more transparent real estate markets, Denis Ma, Head of Research at JLL, said: "There is still room for improvement; most notably in the provision of performance data on unlisted real estate funds and debt markets, along with greater transparency around corporate governance and occupier services. Improving transparency in these areas, however, will require fundamental changes to current business practices, and as such, may take time,"
In Hong Kong, corporate governance will continue to be one of the most challenging areas in which to improve transparency given that many publicly listed companies remain in the control of founding families. Ma said it is one of the key areas of transparency, in which Hong Kong continues to lag. All countries that rank ahead of Hong Kong in the GRETI survey have significantly higher corporate governance transparency scores.
Mainland China's Alpha Cities, Shanghai and Beijing, have shown the greatest improvements in transparency in the country, led by 'Market Fundamentals' and broader moves to improve the legal environment as part of the nation's anti-corruption campaign. Shanghai's global rank has improved from 35th in 2014 to 33rd in 2016 and is now on the cusp of joining the 'Transparent' category. However, many areas for future improvement remain across all Tiers, from areas such as corporate governance to compulsory purchase.
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