Asia Pacific debt funds have become a hot property recently, with capital for it becoming a sought-after investor opportunity. With the market increasingly becoming global as well, investors are looking into creating the capital to delve into the sector. 

JLL reports Australia and India as countries that are of utmost importance in the scheme of things. These markets account for about 86 percent of the capital raised during the years 2015 to 2017. In the case of India, it might be misleading as some of the funds are only raised locally, even though some large funds generate capital in USD. 

Most markets in the region are looking at raising record dividends. Funds that are meant for debt investment have since raised over US$2.5 billion in 2017 alone. Other funds in the region-totaling up to 11-have raised more than US$10 billion and are distributing that amount for "potential investments." 

The activity of these markets has greatly interested investors that an increase in the number of those who want in on the action isn't surprising. World Property Journal pointed out several factors that may have influenced such an increase, such as price increases in local markets where the investors are from and a lack of stock in which to invest.  

The Asian landscape has several other rules which cater to new investors. Most markets have created conditions where lenders dabbling in non-traditional methods are welcomed. There are those who feel that a risk-adjusted return resulting from debt vs. equity is a risk adjustment well-earned. More clients are also taking positioning in a debt-controlled capital stack. 

China, Hong Kong, and India have all created such conditions, but caution is still advised for those who want to take a crack at these new markets controlled by debt investments. Dr. Henry Chin of the CBRE Research Team suggested caution in underwriting assets which they have no understanding of, an example of which are mezzanine debt and development loans. 

With the market also considered young, thorough due diligence is being highly recommended for interested parties. Markets as young as these are also susceptible to high volatility as well as a reputation for tricking investors that are too much of risk-takers for their own good. 

Despite these, investors are encouraged to choose which of these high-yield markets to invest in at their own risk, of course.