CBRE’s 2024 Global Investor Intentions Survey reveals buyers’ and sellers’ preferred strategies, markets and property types. Highlights of the report include:
Global investors expect to engage in more buying and selling activity compared with 2023 amid growing optimism that the real estate investment market conditions will improve.
Although some further cap rate expansion is expected, this trend should start to reverse by midyear.
While investors in most markets remain cautious in H1 2024, expected interest rate cuts by midyear should lead to improved commercial real estate investment activity in the second half of the year.
CDL’s Integrated Sustainability Report 2024 is their 17th sustainability report since 2008. Themed “Zero in on Nature”, the digital report communicates CDL’s progress towards their material ESG goals and targets, established under the CDL Future Value 2030 sustainability blueprint. External assurance is key to enhance data credibility and instill confidence in readers. CDL’s external assurance of their sustainability report started in 2009 and has continued to expand. ISR 2023 and ISR 2024’s external assurance has been further elevated in its scope against the GRI Standards, SASB Standards, as well as the TCFD and CDSB frameworks.
This year CDL became the first Singapore company to commit to nature-related disclosures based on the TNFD Recommendations in this report.
A Guide to Renewable Energy in Southeast Asia (Rajah & Tann Asia)
Sustainability is quickly becoming a priority for governments and businesses across the world. Amidst the adoption of reduced emission targets, a key area of focus is investment in and deployment of renewable energy (RE), which is a key solution to decarbonisation and achieving net zero emission goals.
Businesses throughout all industries are increasingly looking towards RE, whether to meet the applicable regulations in their jurisdictions, or to utilise the available green incentives. However, to effectively assess the implementation of RE solutions, businesses must first traverse the RE-related policies, restrictions and green financing in their respective jurisdiction. An added dimension of complication is added if the business operates across country lines, as the policies and focus of each country may differ.
To help businesses navigate the policies and laws affecting the RE sector, Rajah & Tann Asia published the Guide to Renewable Energy in Southeast Asia which provides an overview of the RE landscape in Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam, where Rajah & Tann Asia has its geographical footprint.
This Guide summarises the salient legal and regulatory issues in each jurisdiction that businesses should be aware of in their implementation of RE, including the regulatory framework and sectoral policies, RE programmes, government incentives, and key issues in the RE sector.
The Growing Importance of the CSO/Head of Sustainability
Navigating complexity, driving ESG strategy integration and adding long-term value to organizations
In today’s rapidly changing world, sustainability has gained significant importance, especially so in the built environment, which contributes an estimated 40 percent to global carbon emissions making rapid decarbonisation of real estate essential if we are to limit warming increases to the 1.5C threshold to mitigate the worst effects of climate change by 2050.
As businesses increasingly recognize the importance of sustainability and responsible business practices, the need for a Chief Sustainability Officer (CSO) or Head of Sustainability has emerged as a crucial position within organizations to drive change, navigate complexity and unlock the true potential across environmental, social and governance (ESG) dimensions. The role itself is new, with over 60% of respondents in a recent survey conducted by CBRE and the US Green Building Council noting their role was only created in the last three (3) years.
Sustainability—sometimes used interchangeably with ESG—encompasses such a wide and broad spectrum of issues, ranging from climate change and human rights to board diversity and corporate governance. A fast moving regulatory and legislative environment with increasing reporting and compliance requirements, mounting stakeholder pressures, climate change risk mitigation and adaptation, and rapid technological change – all combine to make the world of ESG Increasingly complex and challenging to navigate.
A CSO (or head of Sustainability) therefore plays a pivotal role in navigating complexity, integrating ESG considerations into an organization’s overall strategy and ensuring that sustainability becomes an integral part of decision- making to add ongoing value to the organisation.
In the Asia Pacific region, the role of CSO is rapidly gaining prominence as investors display increased appetite for sustainable portfolios and occupiers seek energy efficient and healthy buildings in line with their own net zero and sustainability commitments. With increasing new regulations requiring even greater sustainability disclosures, the role of a CSO is becoming mission critical, and the hunt for talent in APAC is on.
Increasingly, and importantly, the CSO serves as a bridge between the organization and its stakeholders, including investors, customers, employees, and communities. Internally, they must collaborate with various departments to develop and implement sustainability initiatives, identify opportunities for innovation and efficiency improvements, and build organisational capabilities.
Eighty-four percent (84%) of survey respondents noted managing stakeholder relationships and fostering cultural change (76%) as key elements of their roles. They must develop and maintain transparent communication channels, addressing stakeholders’ concerns and expectations, both internally and externally.
CSOs also indicated concerns regarding future regulatory changes and the nascent stages of understanding risks that climate related disasters pose to their portfolios. They acknowledge much more work needs to be done to promote the long-term benefits that sustainability adoption has on corporate branding, talent attraction and climate risk mitigation. Embedding Sustainability takes time, strong business acumen and stakeholder management – and a powerful desire to make a positive change recognising that people, planet, and business performance are interdependent.
CSOs have a broad remit to track ESG project progress and enhance transparency
In response to the tighter regulation of sustainability-related disclosure, the primary focus of CSOs is ESG monitoring and reporting, as well as implementation of related projects.
CSOs are also responsible for fostering corporate change to promote and align with their company’s ESG goals. This includes assisting different business lines to develop ESG capabilities and acccountability.
As many CSOs tend to focus on implementing internal corporate priorities, relatively fewer are engaged with lobbying policymakers on related policies. However, as the path to decarbonisation involves significant regulatory change and policy support, this is an area CSOs cannot overlook.
At CBRE, we have witnessed the benefit of having the clarity of leadership and direction with our first Chief Sustainability Officer Rob Bernard, who joined CBRE last year with 20 years of experience working at the intersection of sustainability, business and technology—including serving as Microsoft’s first Chief Environmental Strategist. His leadership has galvanised the integration of sustainability across our business globally to better serve our clients and deliver on our own commitment to achieve net zero carbon emissions by 2040. We are positioned to simplify complexity so that we can accelerate sustainability progress through clear and executable strategies for our clients. We do this for clients big and small, global, regional, and local.
We have significantly invested in tools, partnerships, technologies, and services that have the power to drive change at scale and transform the industry for a sustainable future. And we also recognise that to champion sustainability within the built environment, our efforts begin at home as we tackle the very same challenges faced by our clients.
The role of the CSO will continue to evolve as sustainability matures, and organisations that have invested in this role are better placed to manage risk, drive cost savings and operational efficiencies, engage stakeholders, foster innovation, and promote employee engagement. The CSO is multi-faceted and affects all parts of the organisation, reflecting the wholesale change that is needed to gain a competitive advantage as we transition to a decarbonised world. The role is critical in creating long-term value, enhancing brand reputation, and positioning their organisations as leaders in sustainability and ESG practices.
David Fogarty
Head of Sustainability & ESG Consulting Services, Singaporeand South East Asia CBRE
Office Fit Out Cost Guide 2024 (Cushman & Wakefield)
Against a volatile economic backdrop, the Asia Pacific office market remains steadfast and continues to grow, with a broadly positive outlook. The need to innovate and evolve has not diminished. Companies are striving to meet their Environmental, Social, and Governance (ESG) targets, and new modes of working embrace flexibility, collaboration, and innovation, while fostering diversity and inclusion. The office is central to many of these transformative processes, with an increasing focus on building quality, fit out design, and raw material selection.
This year’s Guide takes a closer look at 33 key cities across the region, as well as:
Key considerations for a best-in-class office fit out: creating office value, inclusive and sustainable design and partnership with landlords
Cost estimates of three different styles of fit outs to cater to the post-pandemic workforce
A comprehensive fit out cost breakdown that includes furniture, mechanical and electrical works, construction works, IT, audio visual and miscellaneous costs
Three different levels of reinstatement costs, together with average retrofit costs
Wealth Continuum: Navigating Real Assets in APAC Family Offices
In the Asia Pacific region, family offices have become significant players in infrastructure and real assets, leveraging their wealth to strategically invest amidst evolving market dynamics. Despite challenging conditions, 58% of family offices in the region reported asset growth, with a notable focus on increasing investments in real estate and private debt. These trends were further highlighted in a panel discussion organized by APREA, where experts emphasized the importance of adapting to changing interest rates and building operational efficiencies in investment decision-making.
Global Capital Flows: Asia Pacific Highlights (Colliers)
Asia Pacific has emerged as a dominant source and destination for global capital. Singapore, Hong Kong, China and Japan were among the top ten sources of global cross border capital in H2 2023. Notably, Singapore and Hong Kong were the second and thirds biggest sources of global cross border capital respectively.
Japan, China, Australia and Singapore were among the top ten destinations for global cross border capital in H2 2023.
Asia Pacific performed best in 2023, with investment volumes reaching 91% of their 10-year average. While North America reached 68%, the Europe, Middle East and Africa (EMEA) region reached just over half (52%) of its 10-year average. In 2023, global investment volumes were among the lowest since the global financial crisis with overall investment volumes at 75% of the 10-year average.
The region’s performance was backed by a significant pick-up in investment activities in Q4, primarily in December, signalling the region’s strong potential for recovery in the year ahead. Colliers’ global report highlighted that the forecasts for 2024 and 2025 present Asia Pacific’s strong growth story.
The pandemic spurred a sharp rise in e-commerce, causing global supply chain vulnerabilities that underscored the need for greater resiliency. Third-party logistics (3PL) warehouse operators had to optimise supply chain operations, cut costs and utilise new technologies. 3PLs have been highly effective, now dominating demand for industrial & logistics space, impacting real estate fundamentals and warehouse building design, and leading to further industry evolution such as fourth-party logistics (4PL) and reverse logistics.
3PLs have grown globally:
Asia-Pacific: 3PLs accounted for 30%-40% of logistics leasing activity in 2023, with marginal growth ahead. This trend is driven by cost-cutting initiatives and a desire for efficiency amid logistics’ increasing complexity.
United States: 3PL leasing activity accounted for more than 30% of bulk transactions (over 100,000 sq. ft.) since the pandemic’s onset due to significantly higher e-commerce, requiring corresponding warehouse space. Although economic uncertainty has slowed short-term 3PL growth, the long-term outlook is strong. 4PL will drive even more modern warehouse space demand.
Europe: 3PLs have become a larger part of logistics leasing demand, increasing by 10+ percentage points since 2019. During this time, for XXL facilities (warehouses over 50,000 sq. m. or 580,000 sq. ft.), final occupiers have increasingly preferred to control the lease themselves and contract a 3PL to operate the warehouse.
2024 Investor Insights – Country Spotlight Series (Colliers)
2024 is anticipated to be a more dynamic year for the Asia Pacific real estate industry. The ability to act quickly, dig deeply into markets and sectors to identify value, and forge productive partnerships will be key to making the most of the region’s resurgence.
Colliers’ 2024 Investor Insights – Country Spotlight Series aims to provide real estate investors and owners with unique insights into the year ahead and a deep understanding of each market across the region. As investors evaluate their portfolios against the fast-evolving global landscape, this series provides a strategic view on the key market dynamics, outlook and opportunities, along with actionable insights across asset classes in Asia Pacific.
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.
