Global fund managers housed in Singapore and Hong Kong are setting up a fresh series of billion-dollar property funds to invest across Asia, and Australian office towers, shopping centres and industrial parks are emerging as their prime targets.
Singapore-based Alpha Investment Partners, part of the Keppel conglomerate, recently established an office in Sydney to gather intelligence and give it quicker access to the targeted assets. 
AIP, a key part of Keppel's $S26 billion ($25bn) asset management platform, is launching its $US1bn ($1.34bn) Alpha Asia MacroTrend Fund III this quarter and for the first time AIP will be looking to Australia for investment opportunities. London-based Savills Investment Man-agement is planning a $US1bn Asia core-plus fund, to be known as Savills Asia Fund 3, to be launched this year. It will be run out of Singapore, but again Australia features strongly as its destination of choice.
"We see Australia as a market that can offer stable income from core investments," Justin O'Connor, chief executive of SIM, said.
His assessment of Australia is echoed by another fund manager based in Hong Kong, who is currently raising $US500 million for his firm's Asian fund.
Fund managers say that interest in the Asia-Pacific came on the back of a realisation that Asia is now the world's largest real estate investment market.
"With Asia now such a large part of the real estate universe, a lot of money is being allocated to this region," said a Hong Kong-based American fund manager.
Institutional investors from outside the region, usually from the US and Europe, are looking for diversification away from their home markets. Due to their enormous scale, if even half a dozen of the large field of new Asian real estate funds manage to reach their initial targets, the impact on the local market will be significant.
Australia is a key destination for global investors allocating capital to Asia Pacific. Last year, foreign investors accounted for 41 per cent of sales - $11.7bn of all commercial real estate transactions - in Australia, according to real estate agency CBRE.
Josh Cullen, CBRE national director, capital markets, predicted that investors would increasingly look at well-aligned partnership deals to get a foothold in the Sydney market. Although most investors are still focused on core assets, some are also shifting up the risk curve to look at value-add or lower-grade stock.
John Marasco, managing director of capital markets and investment services at Colliers International, said that capital partnering with local groups is another option.
Offshore funds are likely to keep chasing Australian property. While global investors nominally target the entire Asia-Pacific, opportunities are limited because many countries are still considered "emerging markets".
These are perceived too risky in the current environment, as global investors have switched from "opportunistic" or "value-add" plays to the safety of core -investments like premium office towers or shopping centres.
An estimated $US10bn is to be spent on real estate in the Asia--Pacific in 2016, according to the industry body, ANREV, and investors regularly nominate Sydney, Melbourne and Tokyo as their preferred destinations. However, Japan is a notoriously difficult market to crack for foreigners without local connections.
The Australian tapped several large global fund managers who, between them, are hoping to raise between $US3bn and $US4bn in the coming months.Their mandates will require them to buy in Singapore, Hong Kong and Seoul, but they also expect to tilt their allocations towards Australia. One leading global fund manager based in Hong Kong insists that Australia continues to look more interesting than a lot of other countries.