Real Estate APAC

The value of investments and any income from them can go down as well as up and investors may not get back the amount originally invested.

The risk factors listed below are not exhaustive.

General Real Estate Risk: The investments will be subject to risks incidental to owning and operating real estate projects, including risks associated with the general economic climate, geographic or market concentration. There is no guarantee in respect of the repayment of principal or the value of investments, and the income derived therefrom may fall as well as rise. Investors therefore may not recoup the original amount invested. In particular, the value of investments may be affected by political and economic news, government policy, changes in technology and business practices, changes in demographics, cultures and populations, natural or human-caused disasters, pandemics, weather and climate patterns, scientific or investigative discoveries, costs and availability of energy, commodities and natural resources. The effects of market risk can be immediate or gradual, short-term or long-term, narrow or broad.

Liquidity Risk: Private real estate, including investments made directly or through corporate or fund structures, is an illiquid asset class. Investors should be warned that there may not be a secondary market for their shares or interest in the fund or partnership. Liquidity risk may arise due to challenges in selling assets quickly, and it may require a substantial length of time to liquidate.

Tenure Risk: Institutional direct real estate investments are typically underwritten with a long holding period and are only suitable for investors who have a long-term investment horizon.

Economic Conditions: The economic cycle and prevailing interest rates will impact the fundamentals of the underlying investments. Economic activity and sentiment also impacts the performance of underlying companies and could have a direct bearing on the ability of companies to keep up with interest and principal repayments.

Risks Associated with Certain Types of Real Estate: In addition to the general real estate risks described above, other factors that may adversely affect the value and successful operation of, and income generated from, certain types of real estate investments includes the following: the physical attributes of a building used to generate income, location of the property , ability of management to provide adequate maintenance and insurance, the types of services or amenities that the property provides, the property's reputation, competition from other real estate investors, the level of mortgage interest rates, presence or construction of competing properties, the quality of tenants and tenant mix and adverse local, regional or national economic conditions. This list is not exhaustive and there could be other factors could have a material adverse effect on the performance of an investment.

Investors in alternatives products should bear in mind that these products can be highly speculative and may not be suitable for all clients. Investors should ensure they understand the features of the products and fund strategies and the risks involved before deciding whether or not to invest in such products. Such investments are generally intended for investors who are willing to bear the risks associated with such investments, which can include: loss of all or a substantial portion of the investment, lack of liquidity in that there may be no secondary market for the fund and none may be expected to develop; volatility of returns; prohibitions and/or material restrictions on transferring interests in the fund; absence of information regarding valuations and pricing; delays in tax reporting; key man and adviser risk; limited or no transparency to underlying investments; limited or no regulatory oversight and less regulation and higher fees than mutual funds.

Please note that alternatives related investments are generally illiquid, long term investments that do not display the liquid or transparency characteristics often found in other investments (e.g. listed securities). It can take time for money to be invested and for investments to produce returns after initial losses. As such alternatives related investments should be considered as a very high risk investment and are only suitable as part of a diversified portfolio. Before making such investments, prospective investors should carefully consider the risks set forth in the relevant investment documents.

The contents of this document have not been reviewed by the Securities and Futures Commission of Hong Kong (“SFC”) or any regulatory authority in Hong Kong. You are advised to exercise caution in relation to any relevant offer. If you are in any doubt about the contents of the relevant investment documents you should consult your accountant, legal or professional adviser or financial adviser. The relevant product is not authorized under Section 104 of the Securities and Futures Ordinance of Hong Kong (“Ordinance”) by the SFC Accordingly, the distribution of any relevant Private Placement Memorandum, and the placement of interests or units in Hong Kong, is restricted. Any relevant Private Placement Memorandum may only be distributed, circulated or issued to persons who are professional investors under the Ordinance and any rules made under the Ordinance or as otherwise permitted by the Ordinance.

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