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There were two major factors affecting the Asian real estate market in the past few years, namely COVID-19 pandemic and interest rate hikes.

COVID-19 is no longer considered a public health emergency of international concern while stable or slightly lower interest rates from the Federal Reserve in 2024 is anticipated by many Asian markets. This is expected to increase the appetite for property investment over the next 12-24 months.

Key highlights in the Report:

Office Sector

• Investors are seeking more stable revenue streams and longer-term capital gains in Asia markets.
• There is an oversupply of office space in Bangkok, Beijing, Jakarta and Shanghai; and it will take time for the market to absorb.
• Rental levels in Bangkok and Beijing are under pressure while office rent in Seoul is rising due to limited new supply.

Retail Sector

• High street and prime retail malls in different markets have faced challenges during the pandemic, with the exception of district retail centres offering daily necessities for the neighourhood.
• High inflation in many Asian markets has impacted overall consumption.

Industrial Sector

• There is an oversupply of industrial space in Beijing, Seoul and Shanghai, making the industrial sector in these markets buyer and occupier’s market.
• Jakarta is expected to have a steady performance in the industrial sector driven by the electronic automotive industry.
• Bengaluru, Hong Kong and Mumbai have stable demand for logistics, warehouses and data centres.

This report was originally published in https://www.colliers.com/en-xa/research/2019-to-2023-apac-cap-rates-report

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Southeast Asia foresees strong economic growth in 2024, with most major economies expected to accelerate despite challenges like inflation and geopolitical tensions. Easing inflation and increased investments are poised to further support growth.

Cushman & Wakefield's latest paper explores the promising growth prospects of Southeast Asia (SEA) in 2024. Forecasted to expand by 4.6%, SEA's economy is on an upward trajectory, outpacing the previous year's growth rate of 4.0%.

Singapore’s economic growth is set to improve to 3.0% in 2024, higher than 1.1% growth in 2023, albeit growth would be tempered by a still-high interest rates environment and global economic uncertainties.

Economic growth would be underpinned by a recovering manufacturing sector as external demand recovers and resilient demand for services given Singapore’s status as a regional business hub and tourism recovery. Overall property demand is expected to improve, albeit cautiously, and higher supply in some markets such as the residential and office market would crimp rental prospects.

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The Wealth Report’s unique data, expert insights, thought-provoking interviews and future views help shed light on the key issues affecting how you live, work, invest and give back.

In brief:

• Private capital is critical for real estate investment, representing a record 49% of all commercial transactions in 2023.
• With wealth creation turning positive again, the choices of UHNWIs will have a growing influence on real estate outcomes.
• 22% of wealthy individuals want to invest in residential property this year, and 19% in commercial property.
• The need for private capital to aid the repurposing and upgrading of global property have never been higher.

This report was originally published in https://www.knightfrank.com/wealthreport

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Despite a challenging economic environment, data centres remain in focus for the commercial real estate industry in Asia Pacific, with notable market developments across the region.

CBRE's latest Asia Pacific report explores key data centre investment trends and outlook for the sector in the region, and offers insights into the data centre occupier and investment market in Australia, Hong Kong SAR, Japan, Singapore, India and Korea.

Key regional trends include:

• Investor demand for data centres is strong, with a wide range of buyers seeking stabilised assets. However, there remains a lack of stock for sale.
• Prevailing high interest rates continue to weigh on data centre investment. However, investment volume in 2024 is expected to recover from last year’s low base, driven by activity in Japan.
• In addition to increased activity by hyperscalers and more corporates moving towards a co-location approach, there has been a surge in AI-related demand since late 2023.
• Power supply, especially a lack of renewable energy, is becoming a major challenge for future data centre development. 

This report was originally published in https://www.cbre.com/insights/reports/asia-pacific-data-centre-trends-q1-2024

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