Thought Leadership

The Asia-Pacific Horizon report examines the present economic and geopolitical landscape, evaluates the challenges and opportunities within the Residential and Commercial sectors, and provides guidance on unlocking potential.

CBRE’s 2025 Asia Pacific Investor Intentions Survey uncovered an improvement in buying intentions across most markets in Asia Pacific this year, with over half of respondents indicating their preference to buy more real estate in 2025. With the interest rate cut cycle underway in most markets, investors are gearing up for an increase in activity over the next 12 months, albeit with individual Asia Pacific markets staggered at different stages of the pricing and investment cycles.

Although real estate investment activity in most markets is forecasted to increase through 2025, the extent at which it will do so will differ according to location. While markets including Australia, Korea, Singapore, and Hong Kong SAR are expected to see gains in transaction activity in 2025, investors are less optimistic about the extent of rate cuts in 2025, which could weigh on investment sentiment throughout the year. After a strong 2024, Japan and India are expected to witness robust purchasing activity in 2025, with core/core-plus investment strategies in the former and opportunistic strategies in the latter most prevalent. 

The survey was conducted in November and December 2024. Over 460 responses were received from participants who were asked a range of questions related to their buying intentions, perceived challenges and preferred investment strategies, sectors, and markets for the coming year. 

Other key findings:

• Sentiment: Overall investment sentiment has improved, with net buying intentions increasing from 5% in 2024 to 13% in 2025. Investors indicated that interest rate cuts and asset repricing are the main reasons behind their willingness to increase allocations to real estate.
• Strategy: The survey revealed that core-plus and value-added investment strategies are set to gain momentum in 2025 as investors look to hit target returns and acquire core assets for core-plus and value-add pricing. Interest in opportunistic investment strategies continues to weaken.
• Asset class: Offices and data centres saw the biggest uptick in investor preference in 2025, with investors in the former seeking core and core-plus product, and buyers of the latter preferring opportunistic pricing, particularly in Southeast Asia. Among core investors, industrial remains the preferred property type. While living sector assets remain attractive, the lack of investable stock outside of Japan, Australia and mainland China will continue to cap investment activity in the region.
• Alternatives: Healthcare assets remain top of mind for investors considering alternative assets, with data centres climbing back to second place. This year’s survey also uncovered a greater emphasis on living sector assets, such as retirement living and student accommodation.
• Destinations: Tokyo retained top spot for a sixth consecutive year as the preferred market for cross-border real estate investment, followed by Sydney and Singapore. Two Indian markets (Mumbai and New Delhi) ranked in the top 10 cross-border destinations for the first time since surveys began.
• Sustainability: Investors ranked acquisition and development of green buildings above retrofitting existing buildings as their top option in 2025. Although progress remains gradual, investors continue the trend of placing a higher green premium on ESG-certified assets.

CBRE’s latest leasing market sentiment index reveals that overall leasing sentiment improved in Q4 2024, led by Japan and Korea, with the leasing pipeline to improve slightly across all sectors in 2025:

• Office – Lower appetite for expansion: There was a slight increase in enquiries and site inspections this quarter, with most occupiers opting for lease renewals over relocations. Selected markets, particularly those in Greater China, continued to report downward pressure on rents. Expansionary sentiment remained strong in Japan, but tenants in mainland China focused on downsizing to cut costs.
• Retail – Upbeat sentiment: Leasing sentiment remained positive, backed by strong expansionary demand. Hong Kong SAR and Australia reported a rebound in sentiment amid a rise in enquiries and site inspections. The leasing market continued to favour landlords, with rents witnessing steady gains.
• Industrial & Logistics – Tenant-favoured: Most surveyed markets remained in favour of tenants, consistent with the previous quarter. Rising incentives were also observed. Expansionary appetite is stronger compared to last year.

APREA’s flagship event, the Asia Pacific Real Assets Leaders’ Congress, highlighted Asia’s growing importance as a prime investment destination amidst global macroeconomic shifts.

Key points:

• Japan was spotlighted for its stability and opportunities in real estate, with rising demand in sectors like offices, logistics, and residential markets. Innovations such as data centers and J-REITs with stable yields were also emphasized as attractive investments.
• India’s booming logistics and REITs and InviTs sectors, driven by strong domestic demand and liberalized regulations, make it a compelling choice for global investors seeking growth.
• Emerging sectors across Asia, including data centers, life sciences, and senior housing, were identified as promising opportunities, particularly as ESG considerations and technology integration reshape real assets.
• Despite challenges such as China’s economic headwinds and regional geopolitical uncertainties, the conference underscored the importance of adapting investment strategies and leveraging Asia’s growth story to navigate the evolving global real assets landscape.

The rise of mixed-use development platforms has prompted hospitality brands to diversify their offerings, expanding into residential spaces such as resort villas and luxury apartments to cater to a broader audience. This note provides an overview of the concept of Branded Residences and explores how the Indian market is adapting and evolving with this trend. As the hospitality sector in India is still relatively new to Branded Residences, this note highlights key features, incentives, and regulatory considerations, serving as a guide for both the hospitality and real estate sectors to make informed decisions.

In today’s highly competitive Asia Pacific retail market, retailers must continually create innovative products, services and experiences to differentiate themselves from their peers. With brick-and-mortar retail remaining an integral part of consumers’ shopping journey, retail real estate continues to play a major role in the creation and delivery of innovative brand experience.

Based on its market-leading research, CBRE has identified 12 attributes that nurture innovation in retail real estate across four pillars: 1) Market size; 2) Consumer profile; 3) Retailer growth strategies; 4) Spaces that tell a story.

CBRE has used these attributes to create the Asia Pacific Retail Innovation Index, which analyses the innovation performance of major cities in Asia Pacific and identifies their strengths, weaknesses and relative appeal to retailers.

The report also provides recommendations to retailers and landlords on how to spark innovation and creativity in their portfolios to address the retail industry’s evolving needs and expectations.

Around the world, main streets serve as cultural and economic powerhouses that shape the identities of the cities they anchor. In its 34th year, Cushman & Wakefield’s Main Streets Across the World report confirms the value of main streets worldwide, key economic and social trends shaping their value, and the role they play in crucial global and local business decisions.

A New Era of Main Streets

Despite economic challenges, main streets have shown remarkable resilience as headline rents globally finally surpass prepandemic levels. Retailers continue to target prime locations for their strategic importance and potential for customer attraction, demonstrating their flexibility and strength by adapting to shifting economic conditions and consumer demands. Challenges like rising interest rates and inflation have dampened consumer confidence—yet forecast further rate cuts bring a hopeful outlook for recovery. Retailers are navigating cost pressure challenges while adapting to shifting consumer loyalty trends that demand an omnichannel customer journey, making main street locations increasingly critical arenas for longterm business growth.

The Indian ports sector is witnessing increased private sector participation, particularly by way of Public-Private Partnerships (“PPP”). The government has facilitated private sector participation by adopting investor friendly PPP models and streamlining tender processes and concession agreements for major ports. Due to multiple regulatory authorities and differing practices of port authorities, mergers and acquisitions in the ports sector in India are associated with unique considerations that potential acquirers should bear in mind. This note discusses the key regulatory and contractual considerations relevant to mergers and acquisitions in the ports sector in India.

Aakanksha Joshi

Partner,
S&R Associates

Ameesha Tripathi

Associate,
S&R Associates

Apurv Sharma

Counsel
S&R Associates

Rajat Sethi

Partner
S&R Associates

India’s education sector, forecast to reach a market size of USD 313 billion by FY2029-30, is experiencing rapid growth, driven by a robust economy, burgeoning population and urbanisation, rising per capita incomes, and conducive government policies.

The country’s comprehensive education system is characterised by its scale and breadth, with 1.49 million K-12 schools educating approximately 265 million students. Additionally, its higher education sector is among the largest globally, encompassing nearly 59,000 institutions and enrolling an estimated 43 million students.

As a cornerstone of economic development, India’s education sector has garnered substantial interest from both public and private stakeholders. The government’s commitment to education, as evidenced by the significant budgetary allocation over the years, is expected to foster further growth. Moreover, the sector has witnessed significant foreign direct investment (FDI) equity inflows of USD 9.5 billion since 2000.

While these developments are encouraging, achieving the ambitious objectives outlined in the National Education Policy 2020 necessitates a further strategic increase in budgetary expenditure – a gradual increase in education spending from 2.7% of the country’s GDP in FY2023-24 to the targeted 6% is imperative to ensure the sector’s sustained progress.

Notably, India’s education sector prioritises social good over profit generation, involving a combination of ‘not-for-profit’ activities and ‘for-profit’ administration. Private entities play a significant role by contributing through various business models, encompassing infrastructure and facilities development, strategic investments for expansion, or the provision of management and administrative services.

As the sector grows, there is a corresponding need to strengthen educational infrastructure across the country, presenting significant opportunities for real estate developers and investors.

CBRE India conducted a real estate opportunity assessment to evaluate the additional space requirement of K-12 and higher education institutions that can accommodate the projected growth in student enrolment in India. Our real estate opportunity assessment for India’s education sector indicates an estimated 4+ billion sq. ft. of additional space requirement by 2034-35.

Over the course of 2024, CBRE has been tracking the emergence of a curious phenomenon across the Asia Pacific retail property market.

Despite slower retail sales growth, subdued consumer confidence, and a raft of negative headlines about certain retailers’ weaker-than-expected performance, retailers across a range of categories continue to aggressively seek expansion opportunities; a trend that is pulling down prime vacancy and driving up rents.

This Viewpoint explains the factors driving this trend and provides recommendations to retail landlords and occupiers seeking to chart a course through what is an increasingly complex marketplace.