Overview: Asian real estate securities are up 17.53% YTD in USD, supported by recovering REITs/Developers, positive FX, and falling rates reigniting investor interest. Lower borrowing costs in Asia ex-Japan enable earnings upgrades and accretive acquisitions, while a weak USD, low growth, and falling rates continue to support positioning in the sector.
Japan: JREITs up 11.9% since January but still trade at a 13% NAV discount. Ongoing asset sales and buybacks continue, while BOJ remains cautious amid US-Japan trade tensions. Fundamentals in Office and Hotels remain strong, and rising construction costs are limiting new supply.
Australia: The RBA is expected to cut rates later this year, with inflation within target and labour markets softening and part-time jobs declining. We are maintaining overweights in Residential-Diversified, Retail, and Self-Storage. Macro data is expected to drive prices ahead of August earnings.
Hong Kong: HK real estate stocks rose over 20% in H1 2025, supported by falling rates, recovering retail, residential and tourism activity, and underweight investor positioning. HK Land has led gains on asset sales, buybacks, and dividend enhancement, while large-cap developers remain at wide NAV discounts.
Singapore: Large-cap SREITs are trading at 2025 highs, supported by falling rates reducing refinancing costs and enabling DPU-accretive deals. The recent NTT Global Data Center REIT IPO was 2.5x oversubscribed with an initial 7.5% yield. New residential cooling measures are unlikely to materially impact the sector.
Asia Pacific Logistics Occupier Survey 2025 (CBRE)
The 2025 CBRE Asia Pacific Logistics Occupier Survey reveals a landscape of cautious optimism among occupiers, shaped by ongoing geopolitical tensions and shifting global trade dynamics. While short-term business confidence has dipped—particularly due to tariff uncertainties and regulatory challenges—long-term expansion plans remain intact.
Key findings highlight a growing trend toward diversification of supply chains, an increase in outsourcing, and a pivot toward asset-light strategies to mitigate risk and manage costs. Occupiers are showing strong interest in emerging economies, with India standing out for its robust occupier sentiment, while mainland China continues to grapple with oversupply despite signs of stabilisation.
Asia Pacific Logistics Occupier Survey 2025 (CBRE)
The 2025 CBRE Asia Pacific Logistics Occupier Survey reveals a landscape of cautious optimism among occupiers, shaped by ongoing geopolitical tensions and shifting global trade dynamics. While short-term business confidence has dipped—particularly due to tariff uncertainties and regulatory challenges—long-term expansion plans remain intact.
Key findings highlight a growing trend toward diversification of supply chains, an increase in outsourcing, and a pivot toward asset-light strategies to mitigate risk and manage costs. Occupiers are showing strong interest in emerging economies, with India standing out for its robust occupier sentiment, while mainland China continues to grapple with oversupply despite signs of stabilisation.
Rising Sun, Rising Returns: Japan’s Strategic Edge in a Volatile Global Economy
As global economic headwinds reshape capital flows, Japan has emerged as a top destination for cross-border investment in 2025. A convergence of macroeconomic trends, structural reforms, and favourable policy dynamics is solidifying Japan’s status as a strategic anchor amid global uncertainty. Despite rising global interest rates, Japan has maintained a positive yield spread across all major real estate sectors, making it particularly attractive to institutional investors seeking income stability.
Cushman & Wakefield’s What Occupiers Want 2025, in collaboration with CoreNet Global, presents findings from over 235 global CRE leaders, offering a timely perspective on evolving workplace strategies, investment priorities, and the future of office space.
Key insights include:
Cost remains king, continuing to drive real estate decisions across regions.
Reporting lines are shifting, with nearly 30% of CRE teams now reporting into HR—reflecting growing alignment with people and culture agendas.
Flexible hiring takes hold, as 61% of occupiers adopt geographically flexible recruitment strategies.
Portfolios are stabilizing, with a decline in planned reductions and rising occupancy levels.
Expectations from landlords are growing, with 85% of occupiers seeking enhanced amenities—and 46% willing to pay a premium.
A call for better metrics: CRE leaders are urged to adopt holistic frameworks that link workplace decisions to business performance.
The Evolution of Hotel Brands in Asia Pacific: Why it Matters (CBRE)
The global hotel industry is in a period of brand consolidation, with the world’s leading operators continuing to expand their footprint through new developments and brand strategies.
With hotel brand penetration still relatively low compared to the U.S. and Europe, Asia Pacific has become a key growth market.
CBRE Research estimates that 74% of Asia Pacific hotel supply between now and 2030 is aligned with one of the top 8 listed hotel companies – a significant increase over the currently operational market share of 18%.
Our latest report analyses the current state of the hotel brand landscape, and explores the brand strategies that owners and operators are pursuing to adapt to ever-changing market dynamics.
Overall: We maintain a cautiously optimistic view on Asian REITs, supported by falling interest rates across Asia ex-Japan, which enable lower financing costs and open the door for accretive acquisitions. Singapore exemplifies this trend, with Capitaland Ascendas acquiring assets at attractive cap rates using low-cost debt and equity raised at a premium to NAV.
Regional Highlights:
Japan: JREITs have outperformed equities in 2025 despite rising bond yields, driven by wide valuation discounts and buybacks. While refinancing at higher rates is a headwind, rental growth from expiring COVID-era leases and strong fundamentals in office, hotel, and urban retail sectors provide earnings support. JREITs are preferred over developers at this stage.
Australia: Ex-Goodman, REITs have rallied with names like Charter Hall and Mirvac seeing strong gains. Valuations are now full in some names, prompting rotation to undervalued plays like National Storage REIT, which may benefit from consolidation trends and takeover potential. Exposure to Australia has been trimmed in favor of better value in Singapore.
Hong Kong: Ultra-low HIBOR levels and recovering residential demand support REITs and Developers, particularly those with floating rate debt. Retail REITs benefit from stabilizing sales and moderating outbound travel. Link REIT and Fortune REIT may gain from Stock Connect inclusion. Caution remains for the oversupplied Central office market.
Singapore: Large-cap SREITs (CICT, CLAR, Frasers Centrepoint) offer compelling relative value. Despite rate cuts, sector underperformance persists, but the high yield spread over rates is expected to attract rotation from banks. Accretive acquisition pipelines and potential growth in data centers and healthcare assets add upside.
For decades, the real estate industry has viewed insurance as a necessary cost of doing business — a safeguard against unforeseen risks, but rarely a tool for creating value.
That paradigm is shifting.
Link Asset Management (Link) has introduced how real estate climate resilience efforts can be linked with insurance terms — a model that doesn’t just provide protection but actively rewards investment in climate adaptation measures.
By quantifying climate risk and making targeted resilience investments, Link, through its insurance broker Marsh Hong Kong, secured an 11.7% reduction in property insurance premiums — significantly outperforming the industry’s ~3% average. Even more importantly, Link negotiated an additional 7.5% premium reduction tied to its loss ratio, creating a direct financial incentive to continue investing in long-term climate preparedness.
This case study isn’t just about one company’s success. Rather, it highlights a fundamental shift and real-time opportunity for real estate firms — and insurers — to align incentives and build climate resilience.
As a reminder – that extreme weather events are already becoming more severe under climate change, leading to significant financial losses
As a showcase – of proactive climate risk adaptation measures
As a call to action – to leverage the mutually beneficial relationship between asset managers and insurers for building climate resilience
From Risk Awareness to Resilience in Action
Extreme weather events are no longer an anomaly — they are an operational reality. In September 2023, Hong Kong experienced a “double whammy” of Super Typhoon Saola and record-breaking black rainstorms, causing widespread property damage. The conventional response across the real estate industry was reactive: filing claims, absorbing losses, and bracing for inevitable premium hikes.
Link chose a different approach. Rather than treating resilience as a cost, it saw an opportunity for investment — one that could be quantified, optimised, and ultimately rewarded.
Link reframed its relationship with insurers from a transactional one to a partnership in risk management:
Worked with Marsh Hong Kong to embed resilience efforts into a resilience-focused insurance roadshow, bringing 22 insurers into early discussions.
Presented quantifiable evidence of risk reduction, showcasing Link’s HK$5 million investment into flood resilience measures.
Collaborated with AXA on a Sustainability-Linked Insurance Proof-of-Concept, demonstrating how Link’s flood resilience measures could lower potential losses by 10- 20%.
Negotiated performance-linked premium reductions, securing additional cost savings contingent on a low loss ratio and incentivising continued investment in resilience.
By integrating risk identification, targeted mitigation, and transparent insurer engagement, Link transformed resilience from a defensive measure into a financial advantage.
The Resilience Framework: Six Pillars of Climate Adaptation
Building a resilience-linked insurance model requires a structured, data-backed approach. Link’s framework consists of six interconnected pillars:
Comprehensive Climate Risk Assessments
Asset-Level Resilience Enhancements
Standardised Emergency Protocols
Preventive Maintenance and Drainage Optimisation
Proactive Stakeholder Coordination
Rapid Recovery and Business Continuity Planning
Each of these pillars feeds into Link’s resilience-linked insurance structure, ensuring measurable risk reduction, operational stability, and long-term financial savings.
From Resilience to Competitive Advantage
The results of Link’s resilience-first strategy were significant:
By embedding climate resilience into its operational and financial strategy, Link has proven that climate adaptation isn’t just a defensive measure — it’s a value driver.
“We welcome the efforts made by Link REIT to make their assets more resilient and sustainable, and are pleased to show our support through promising insurance capacity and T&Cs. Extreme weather and climate risk are real issues for real estate and best tackled when all stakeholders work together.”
– Quoted by one insurer on an anonymous basis
What’s next?
For Real Estate Leaders: How can you integrate data-driven resilience into your portfolio strategy?
For Insurers: How can underwriting models evolve to incentivise proactive climate adaptation?
For Investors: How does climate resilience factor into long-term asset valuation?
Real estate is at a crossroads. Rising climate risks will continue to challenge traditional insurance models, but Link’s resilience-linked insurance structure offers a replicable blueprint for other asset owners.
The shift from reactive insurance to proactive risk management has begun — who will follow?
Kemmu Kawai joined Longevity Partners Japan in September 2022 as the Country Director. Based in Tokyo, he oversees all operations and activities in Japan, the Asia-Pacific region and beyond. He brings him more than 16 years of experience in finance where he specialised in real estate and credit investments. Before joining Longevity Partners, he served as a Portfolio Manager at Norinchukin Bank and as Investment Manager at Center Point Development.
