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This in-depth report offers a comprehensive analysis of the five largest REIT markets in Asia: Japan; Singapore; Hong Kong, China (“Hong Kong”); the Chinese mainland; and India.

Key Highlights:

  • In 2023, the India REIT market saw the steepest rise in total market value, up 31% year-on-year.
  • Singapore’s REIT market expanded by 4%, with an average total return of 7.0%.
  • Combined value of the Asia REIT market stood at US$252 billion, dominated by Japan, Singapore, and Hong Kong.
  • The industrial / logistics and multifamily REITs, displayed superior risk resilience, while data center and healthcare sectors continued strong performance.
  • New policy initiatives in the Chinese mainland led to the issuance of seven new REIT products in the first four months of 2024.
  • India’s combined office REITs portfolio is projected to reach 180 million sq ft by 2025, with Nexus Select Trust planning to double its portfolio size over the next five years.
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The beginning of this year saw occupiers in Australia exhibit a more cautious approach due to the sharp rental increases witnessed over the past two years and an increase in new supply. However, demand has picked up in Q2 2024 and the number of transactions is set to increase over the next three to six months.​

In Japan, logistics demand is holding firm in regional cities. After putting expansion plans on hold six months ago, many occupiers are now moving ahead with leasing new space. However, rising vacancy is prompting landlords to fill space as soon as possible to tenants from any sector.​

Sentiment in Vietnam remains positive, backed by the government’s success in boosting the country’s ties with key trading partners, which continues to lure manufacturers from these countries to set up production bases. Factory space continues to attract strong demand, led by the electronics and automotive sectors along with traditional commodities.​

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Despite the current subdued mood in mainland China, optimism is building for an eventual recovery. Several major brands have been seen seeking opportunities to optimise store networks in what is still a tenant-favoured market. Many retailers are looking to operate in a network emphasising one major flagship store per city.

Korea continues to witness a solid rebound in international visitor arrivals, which is driving up consumption and leasing demand. More demand for pop-up stores has been observed in emerging commercial districts including Seongsu, Hannam, and Dosan Park due to tight availability.

Vietnam continues to attract strong interest from foreign brands, particularly those from mainland China. More shopping malls are undergoing renovations to create space for new market entrants and provide a more memorable experience for shoppers by utilising new designs such as bigger atriums.

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Mixed signs of economic recovery in mainland China weighed on investment activity this quarter. Transactions mainly focused on small lump sum assets, the bulk of which were sized at between RMB 100-500 million. Discounted assets, especially in the retail and office sectors, are expected to drive investment in the coming months.

Investment sentiment in Singapore is less negative compared to six months ago, with value-add capital turning more active since the turn of the year. Retail and hospitality properties are expected to offer more opportunities in the coming months, underpinned by solid fundamentals.

India’s investment market continues to see buoyant activity. Strong consumption is translating to solid fundamentals in the retail sector, boosting investor interest. Investment demand in the office sector has also picked up over the past six months, with domestic office funds and Singaporean capital being most active.

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Stay ahead of the curve with APREA’s exclusive monthly update tracking the performance of China REITs.

APREA C-REITs Roundup provides the latest info and developments in C-REITs. Available for APREA members only, this important resource is your key to navigating the landscape of C-REITs.

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Amidst recent challenges in China’s property market, REITs are emerging as key players offering stable returns and growth potential. This shift is supported by strategic sectoral growth, particularly in affordable rental housing and commercial real estate in core cities, benefiting from government support and low interest rates.

With regulatory frameworks maturing and new investment avenues like Pre-REITs and private REITs developing, the long-term outlook for China’s REIT market is increasingly optimistic, providing investors with opportunities for stable income and capital growth.

Find out more about long-term investment opportunities in our latest issue of APREA TrendWatch.

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There is a growing emphasis on sustainability and environmental footprint in the transportation and logistics industries worldwide, with nearly 70% of companies from these sectors in the Fortune 500 having set a net zero carbon target, and around half aiming to achieve this objective by 2030 or earlier. This growing trend is also influencing logistics occupiers’ real estate decision-making worldwide.

In Asia Pacific, an increasing number of logistics occupiers are seeking more environmentally friendly warehouses and distribution centres. CBRE’s June 2024 Asia Pacific Leasing Market Sentiment Index found that energy-related features, particularly renewable energy supply and energy efficiency management, are most preferred. Many survey respondents indicated that occupiers also have a preference for facilities that possess some form of green certification, and that provide charging infrastructure for electric vehicles.

With more occupiers embedding sustainability into their real estate strategy, landlords and investors must accelerate the greening of their Asia Pacific logistics portfolios.

This Viewpoint explores occupiers’ most sought-after green features and explains how asset owners in the region should respond to rising demand for environmentally friendly logistics real estate.

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With the Asia Pacific hotel market continuing to undergo structural change, hotel owners and operators are fine-tuning operational and branding strategies. Increased labour and utilities costs, limited new supply, and the prolonged peak of the interest rate cycle are among the driving factors.

Our latest report explores the key trends shaping the Hotels & Hospitality sector in Asia Pacific, including an analysis of the current market landscape, the latest activities of the major operators, asset management and investment trends, and ESG considerations.

Key trends:

  • Operators keep daily rates high as a result of limited supply, elevated demand and rising labour costs.
  • Major global operators continue to expand rapidly across Asia Pacific, with an increased emphasis on lifestyle brands.
  • Investment remains robust despite debt-related headwinds, and investors maintain preference for upscale+ assets with rebranding opportunities.
  • Adoption of sustainability and ESG initiatives continues; hotels with strong ESG initiatives are set to outperform.
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In the real estate market, the living sectors have become a dominant force, commanding the largest share of global transaction volumes last year. Investments in multifamily, Build-to-Rent (BTR), student accommodation, co-living, and senior living have grown. Countries like Japan, China, and Australia are leading this growth, although challenges such as escalating construction costs and regulatory complexities remain. The living sector’s resilience and potential for stable returns continue to attract significant investor interest, setting the stage for opportunities in the coming decade.

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