Why Asia Pacific offices are different and now is the time to invest

Despite a challenging global economic environment and recent muted investment sentiment, the Asia Pacific commercial real estate market has remained largely resilient. In particular, the office sector remains an important asset class in the region, and one that investors should consider.   

This report explores the opportunities presented by investing in the office sector in Asia Pacific, the supporting data and factors that differentiate this asset class from others, as well as the implications and potential strategies for investors.

Key highlights include:

• Office investment sentiment has weakened globally but deal flow in Asia Pacific remains resilient.
• Structural industry upgrading will support longer-term office demand.
• Asia Pacific is ahead of other regions in the return to office trend.
• Demand for well-located and well-connected office space remains strong.
• Office rents are at the bottom of the cycle in many Asia Pacific markets and are expected to resume growth. Coupled with yield expansion and limited medium-term supply, and with pricing to remain weak in the coming six months, investors could tap into this window of opportunity.
• The office sector in Asia Pacific can help investors diversify their portfolio across different geographies to manage risk and offset some of the volatility observed in specific markets.
• There are a range of cyclical and structural strategies that investors can consider, from focusing on markets that are reaching the turning point of the rental and interest rate cycle, to investing in future-proof green office buildings and mixed-use buildings, and on office enhancement initiatives.