CBRE’s Mid-Year Asia Pacific Real Estate Outlook: Investment Recovery to Gain Momentum in H2 2025; Leasing Market to Remain Steady

Asia Pacific – August 13, 2025 – Asia Pacific’s commercial real estate market performed strongly in the first half of 2025, highlighting the region’s resilience amid global economic challenges, according to CBRE’s 2025 Asia Pacific Real Estate Market Outlook Mid-Year Review.

Despite the ongoing impact of U.S. trade policy, the Asia Pacific investment market has remained robust, with investment volumes increasing by 18% year-over-year in H1 2025. This strong performance has led CBRE to upgrade its full-year investment forecast to a 10-15% growth, underscoring the region’s solid investment fundamentals.

“Momentum in investment activity is gaining traction in Asia Pacific and is expected to remain strong in the second half of the year,” said Greg Hyland, Head of Capital Markets, Asia Pacific, for CBRE. “There is particularly strong investment activity in Korea, Japan, and Singapore, while markets like Australia and Hong Kong SAR are seeing a more subdued pace in H1, although we are seeing evidence that both markets are about to turn.”

While office investment sentiment has improved, significant upcoming supply in certain markets, such as mainland China, India, and parts of Southeast Asia, could impact future investment. Investors are focusing on data centres and living sector assets, which offer structural growth opportunities.

Leasing Market Outlook: Stability Amid Mixed Performance

CBRE anticipates office leasing activity to remain consistent with 2024 levels, supported by stabilising business confidence and stricter return-to-office mandates. There are notable regional variations. Greater China continues to see rental declines, with landlords adopting a more accommodating lease restructuring and incentive strategies. Tokyo and Mumbai, in contrast, have recorded exceptional annual rental growth exceeding 10%, driven by strong demand and limited supply.

“Demand for prime office and retail locations remains strong,” said Ada Choi, Head of Research, Asia Pacific, for CBRE. “Occupiers’ preference for high-quality, well-located space will widen the gap between premium and secondary office markets, especially as new supply is concentrated in emerging and decentralised locations.”

Logistics and Retail Sectors: Stability and Steady Growth

Logistics leasing volumes are expected to remain steady, supported by landlords’ flexible strategies, resilient domestic consumption-related demand, and occupiers planning mid-to-long-term expansions. In the retail sector, sustained demand for core locations is expected to drive vacancy rates lower, although rental growth will remain mild.

Hospitality: Strong Performance in Key Markets

Hotel ADRs (average daily rates) continue to rise in most markets, with occupancy improving as hoteliers adopt diverse pricing and operational strategies. Japan, Korea, Vietnam, and India are expected to lead hotel performance in 2025.

To read the full report, click here.

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