Morgan Stanley remains the largest real estate fund manager in Asia Pacific, according to a survey by a Hong Kong-based industry group, despite running into difficulties with some of its investments in Japan.

The Asian Association for Investors in Non-listed Real Estate Vehicles (ANREV) said late on Monday the US investment bank managed US$19.5 billion worth of Asian property assets as of June 30, 2010, up from US$19.1 billion ($25.3 billion) a year ago.

Overall, real estate fund managers held US$178.6 billion worth of Asian property assets.

Morgan Stanley, an aggressive property investor prior to the global financial crisis, found it hard to securitise its Japan property loans after the nation's real estate market turned sharply lower in 2008.

In July, Reuters reported that Blackstone was close to buying property loans with a face value of around US$1.1 billion owned by Morgan Stanley's Japanese operations at a sharp discount to face value.

ANREV said CapitaLand Financial, the fund management arm of Singapore developer CapitaLand, was the second largest property fund manager in Asia-Pacific with US$16 billion in assets, down from US$18.8 billion a year ago.

Australia's AMP was third with US$12.4 billion, down from US$13.1 billion a year ago.

Other large managers of property funds in Asia include ING, Australia's Dexus Property and Goodman Group, UBS, LaSalle Investment, Lend Lease and Singapore's Pramerica Real Estate Investors (Asia), a unit of US-based Prudential Financial.

ANREV said its survey found that 83.6% of investors in non-listed real estate funds were institutional investors.