Gulf money moving to real estate with focus on Asia

Billions of dollars flowing out of stock markets in the Gulf Arab region are heading into real estate, with markets in China and India a key focus, the head of real estate investment at a leading Kuwaiti bank said.
Markets in the wealthy, energy exporting region are among the worst performing in the world this year after rising on average 92% last year, and burned retail investors are still scrambling to get out.

Real estate funds, considered an easy fit with Islamic law, where interest is banned and income must be derived from a fundamental economic transaction, are benefiting as retail investors in the Gulf migrate toward what they consider a more comfortable asset class.

“When we went to these investors six months ago and said, for example, that we are creating a US real estate fund that will give you an average of 8% per annum they said we’re getting 8% per month on the local stock markets,” Rakesh Patnaik of Kuwait-based Global Investment House said.

“Now our funds are becoming the flavour of the month for investors in the Middle East,” he said on the sidelines of a two day funds conference in Dubai on Monday.

Courtesy: http://www.gulf-times.com