HSBC Life is making a comeback to real estate investment after a multi-year hiatus, targeting value-add property strategies in the Asia-Pacific region. The Hong Kong-based insurer, managing approximately $120 billion in assets, aims to diversify its portfolio away from core-focused, US-heavy real estate holdings.

Global chief investment officer William Chan explained the shift, noting that core property investments no longer offer attractive risk-adjusted returns. The insurer is seeking value-add strategies that could generate returns in the high-single digits, comparable to other asset classes. This move comes as market conditions improve, with valuations resetting and interest rates declining.

The insurer is particularly interested in regionally-focused funds that offer exposure to both developed markets like Australia and Japan, as well as emerging countries. HSBC Life is also exploring diversified property types including co-living, student housing, and data centers. The firm is shifting toward mid-market managers and deals, which provide easier exit opportunities and potentially better returns than larger institutional players.