Cathay Life Insurance is assessing London’s real estate market with a view to making its first investment in overseas property.
Taiwan’s largest insurance company has received approval to invest £400m (€486m) worth of real estate in London, according to Chao-Ting Lin, executive vice president of Cathay Life Insurance.
“We are currently looking for the best timing for our first investment – we hope we can speed up the pace of investment,” he said.
The Taiwanese government relaxed foreign investment rules in April last year, allowing domestic insurance companies to invest abroad for the first time.
Cathay, a division of Cathay Financial Holding, said London and Tokyo were its two main targets because of their “relatively better regulations”. The company said it was looking at office properties in both cities.
Cathay has been increasing its exposure to real estate, from 5.6% of total assets at the end of 2012 to 10.6% as of March this year.
Cathay has total assets under management of TWD$3,873bn (€92.3bn) as of March 2014, up 18% from NT$3,283bn (€78.3bn) as of the end of 2012.
Asked how much it expected its real estate portfolio to increase, the company said it would depend on the ability to source suitable investments.
“Sometimes we are able to find, but sometimes we are unable find anything,” Lin said in response to questions at the company’s quarterly analyst meeting in Taipei.
The Taiwanese government’s decision to relax rules on foreign real estate investments was aimed to curb high property prices in Taiwan and allow insurance companies to improve returns on investment.
Cathay, one of the largest owners of Taiwanese real estate, is adopting a “new approach, turning old property and developing them into hotels”, Lin said.
Cathay Hospitality Group, which is owned by Cathay Real Estate Development, has opened several boutique business hotels in Taipei under the Hotel Cozzi brands over the past two years.