The Debt Funding Gap for Asia Pacific Real Estate (CBRE)

With the Asia Pacific commercial real estate market sitting at the top of the interest rate hike cycle, attention continues to focus upon the sizable volume of outstanding senior loans due to mature; a situation which could lead to a substantial funding gap in the coming years.

CBRE estimates that there is US$257 billion of outstanding senior commercial real estate debt in Asia Pacific, leading to a projected funding gap of US$8.4 billion between 2024-2026.

CBRE expects a funding gap to arise in markets where there is still some degree of capital value decline expected over the next three years. By total volume, Australia will have the biggest funding gap (US$4.6 bln) between 2024-26, followed by mainland China (US$2.9 bln).

The gap will be highly concentrated in the office sector, with CBRE expecting some further repricing over the remainder of 2024.

This report explores the commercial real estate debt market in Asia Pacific and the factors underpinning the debt funding gap in the region, including the markets and sectors that are likely to face the biggest gap, and implications for investors.

This report was originally published in https://www.cbre.com/insights/reports/the-debt-funding-gap-for-asia-pacific-real-estate/

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