Cohen & Steers Boosts Exposure to Mainland China and Hong Kong Amid Fundamentals Bottoming

Cohen & Steers has increased its exposure to Mainland China and Hong Kong, citing bottoming fundamentals. Jon Cheigh, an investor at the firm, believes that most developed markets have undergone yield curve repricing and valuation resets. This shift in strategy reflects a positive outlook on the region's prospects and a recognition that valuations have stabilized following a period of repricing.

Cohen & Steers, Inc., a leading global investment manager specializing in real assets and alternative income, has significantly increased its exposure to Mainland China and Hong Kong, citing bottoming fundamentals. The firm's strategic shift reflects a positive outlook on the region's prospects and a recognition that valuations have stabilized following a period of repricing.

According to Jon Cheigh, an investor at the firm, most developed markets have undergone yield curve repricing and valuation resets. This strategic change aligns with Cohen & Steers' broader focus on leveraging its portfolio management expertise and risk management framework to navigate ongoing macroeconomic uncertainties and geopolitical tensions.

The company's Form 10-Q report for the second quarter of 2025 highlights significant growth in both financial and operational metrics, underscoring its robust performance. Total revenue increased by 11.8% to $136.1 million, operating income rose to $43.3 million, and net income attributable to common stockholders jumped to $36.8 million. These improvements were driven by higher average assets under management and effective cost management.

Cohen & Steers' increased exposure to Mainland China and Hong Kong is part of a broader trend in the region's real estate market. New World Development (NWD), a Hong Kong-based developer, is ramping up the delivery of residential projects in the city and mainland China. The company recently sold more than 600 flats in The Pavilia Forest project, generating over HK$4.2 billion in sales, and has sold 500 units in Deep Water Pavilia and Deep Water Pavilia II, generating nearly HK$8.8 billion. These sales indicate a strong primary property market in Hong Kong, aligning with Cohen & Steers' positive outlook on the region's fundamentals.

Cohen & Steers' focus on Mainland China and Hong Kong is also reflected in its geographic performance. The company's revenue from Europe, the Middle East, and Africa increased by 23.3% compared to the previous year, highlighting the region's growing importance to the firm's overall strategy.

In conclusion, Cohen & Steers' increased exposure to Mainland China and Hong Kong is a strategic move that reflects the firm's positive outlook on the region's prospects and a recognition of stabilized valuations following a period of repricing. This shift is part of the company's broader strategy to navigate ongoing macroeconomic uncertainties and geopolitical tensions.

References:
[1] https://www.scmp.com/business/article/3320248/new-world-ramps-luxury-home-sales-hong-kong-and-mainland-china?utm_source=rss_feed
[2] https://www.tradingview.com/news/tradingview:cbba1d72c6d8d:0-cohen-steers-inc-sec-10-q-report/