Conviction over caution: Strong year-end sets optimistic tone for 2026, return of REIT debuts signals improving liquidity outlook.
Key trends influencing Asia Pacific markets:
- APAC Transaction Volumes: The APAC investment activity reached USD 40.3 billion in the fourth quarter of 2025, up 15% year-on-year. Full-year volumes climbed to USD 147.6 billion, a 12% increase from last year - the strongest year since 2021, closing out a period of steady market recovery.
- Economic fundamentals: Most markets benefited from improving conditions, with broad economic growth, and rate cutting cycles.
- Tariff relief: The easing of tariff concerns has helped support renewed investor sentiment.
- Improving liquidity: Return of REIT debuts signals improving liquidity outlook
- M&A Activity: Operator acquisitions as investors seek entry into operational-heavy sectors at scale
- Thriving living: Buoyant living sector bolstered by PBSA and co-living sees record share of APAC CRE investment
Resilient investment momentum sets the stage for 2026
Asia Pacific real estate markets continued to show stability in the last quarter of 2025, with investment volumes reaching USD 40.3 billion. The rise in quarterly activity signalled improving investor confidence and steady capital flows, as recovery gained traction across major economies in the region.
Japan set the pace in the final quarter, recording USD 9.8 billion in transactions, resulting in the annual total increasing 14% from last year. Investment was driven by industrial deals, exits from development projects, and a landmark logistics transaction. Office and multifamily assets benefited from stronger rental growth. In South Korea, fourth-quarter investment reached USD 7.7 billion, up 41% year-on-year. Demand for core office remained high for domestics and logistics were sought after by foreign investors.
Across Australia and Singapore, investment volumes reflected ongoing adjustment and renewed interest in key sectors. Australia reported USD 6.1 billion for the quarter, a decrease of 15% year-on-year. Real Estate Investment Trusts (REITs) and super funds re-entered the office market, retail activity remained strong, but industrial assets posted their lowest quarterly figure since Q4 2023. Singapore saw Q4 investment reach USD 4.2 billion, up 28%. Growth was driven by activity across the living, office, and retail sectors. Major deals were led by REITs, institutional investors, and family offices.
Looking at North Asia, China continued to face challenges, posting USD 3.4 billion in fourth-quarter investment, down 16% from last year, while full-year volumes fell 17%. Most headline transactions focused on disposals and selective acquisitions by insurance companies and private wealth. In Hong Kong, quarterly investment reached USD 2.4 billion, up 62% YoY, bolstered by two major office transactions. Annual volumes came to USD 6.0 billion, a 32% increase.
India stood out this quarter, posting USD 2.4 billion in Q4, a 407% increase year-on-year. Full-year volume reached USD 7.1 billion, a remarkable jump of 183%. Robust demand for office space and an uptick in foreign acquisitions in industrial assets supported growth.
Overall, the final months of 2025 in Asia Pacific reflected cautious optimism. Transaction activity revealed renewed confidence in core markets alongside strategic diversification into emerging sectors.
As we look to 2026, JLL’s top picks highlight evolving sector opportunities across the region. Investors are paying close attention to prime offices in Singapore and Sydney, logistics hubs in South Korea and India, as well as multifamily in Japan and purpose-built student accommodation in Australia and Hong Kong. There is also growing interest in alternatives such as data centers and energy storage, as the search for long-term growth and diversification continues.
Asia Pacific real estate is positioned for new growth, and investors remain positive about the opportunities in the year ahead.
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