Cohen & Steers Navigates APAC Tariff Uncertainty with Real Assets and Strategic Leadership

Amid rising geopolitical tensions and regional tariff disputes, institutional investors are increasingly turning to real assets as a hedge against market volatility. Cohen & Steers, a leader in alternative income solutions, is capitalizing on this demand through its strategic expansion in South Korea and broader Asia Pacific (APAC) markets. By leveraging Andrew Shin's appointment as Head of South Korea Institutional Distribution and deepening its focus on infrastructure and real estate, the firm is positioning itself to capitalize on APAC's need for defensive, income-generating investments.

The APAC Tariff Landscape: A Catalyst for Real Asset Demand

Regional trade disputes, such as the U.S.-Korea automotive tariffs affecting companies like Nissan, have underscored the fragility of export-driven economies. These tariffs, along with broader deglobalization trends, have fueled inflation and disrupted supply chains. In this environment, real assets—such as real estate, data centers, and infrastructure—stand out due to their low direct exposure to trade barriers and predictable cash flows.

For instance, consider the U.S.-Korea shipbuilding partnership between Edison Chouest Offshore and Hyundai Heavy Industries. While not explicitly a Cohen & Steers investment, such projects highlight the region's reliance on infrastructure to sustain economic growth. Similarly, Amazon's $1 billion data center in Ulsan, South Korea—a project backed by SK Group—demonstrates the demand for tech-driven real assets that are insulated from trade disputes.

Cohen & Steers' Playbook: Infrastructure and ESG-Driven Real Estate

The firm's strategy hinges on three pillars:
1. APAC Real Estate Securities: Cohen & Steers focuses on listed REITs and infrastructure funds in markets like Japan, Singapore, and South Korea. These assets benefit from secular trends such as urbanization, securitization of real estate, and ESG integration.
2. Institutional Sales Leadership: Andrew Shin's appointment signals a push to tap into South Korea's $1.5 trillion institutional investor market. His 20-year track record at Willis Towers Watson positions him to align institutional capital with Cohen & Steers' active management and ESG-focused strategies.
3. Sector Resilience: The firm prioritizes defensive subsectors like data centers (driven by cloud adoption), senior housing (aging populations), and single-family rentals—areas less vulnerable to tariff-driven slowdowns.

Data-Backed Performance: Outperforming Equities in Volatile Markets

Historically, real assets have thrived during periods of trade friction. During the 2018–2020 U.S.-China trade war, listed real estate outperformed global equities by 15–20% annually. Current trends mirror this dynamic:

In Q1 2025, Cohen & Steers' blended real assets strategy returned 6.1%, while the S&P 500 fell 4.3%. This outperformance underscores the sector's low correlation with equities and inflation-hedging properties, critical in an era of sticky price pressures.

Risks and Opportunities in APAC

While real assets are defensive, sector dispersion remains a concern. For example, mall operators in South Korea face margin pressures as retailers grapple with rising input costs from tariffs. Conversely, logistics REITs (e.g., those serving e-commerce hubs) and data center infrastructure are thriving due to their alignment with secular growth drivers.

Cohen & Steers mitigates these risks through active security selection. Its team analyzes NAV discounts, dividend yield sustainability, and ESG metrics to avoid overvalued or vulnerable assets. For instance, the firm's underweight in hotel REITs during 2025 reflects concerns about consumer spending volatility.

Investment Implications: Why APAC Investors Should Take Note

Institutional investors in APAC should consider Cohen & Steers' strategies for three reasons:
1. Diversification: Real assets offer a shield against equity-dominated portfolios. With stock-bond correlations rising, real estate and infrastructure provide a true risk buffer.
2. Income Stability: REITs in APAC yield 4.5–6%, outpacing government bonds and offering growth through dividend hikes.
3. ESG Alignment: The firm's integration of environmental and governance criteria ensures investments in sustainable projects, such as renewable energy infrastructure.

Final Take: A Permanent Allocation for a Volatile World

The U.S.-Korea trade disputes and global deglobalization are not temporary blips but structural shifts. Investors ignoring real assets risk underperforming in the next decade. Cohen & Steers' blend of local expertise, active management, and sector focus makes it a standout player in this arena.

For APAC investors, the firm's South Korea-focused institutional sales team and APAC real estate strategy are clear entry points. Consider allocating 5–10% of a portfolio to Cohen & Steers' listed real estate or infrastructure funds—these stakes could offer ballast during the next tariff-driven storm.

As Andrew Shin noted, “Institutional demand for income solutions is surging in Asia. Real assets are no longer a niche play—they're a necessity.” The data—and the region's geopolitical reality—back him up.