By Keenan Torres — Chief Editor, Global Markets Review
A Region Moving at Different Speeds
Asia-Pacific’s real estate engine kept turning in Q3 2025, but not evenly. According to Savills’ latest market report, the region delivered a total investment volume of USD $35 billion, marking an 18% jump quarter-over-quarter—a clear sign that global capital is flowing back into Asia. But beneath the surface, the story is one of multispeed momentum: certain cities are accelerating while others stall in uncertainty.
Driving the surge is a resurgence in cross-border investment, with U.S. and European funds showing renewed appetite for Asia’s core markets. Yet, sentiment remains cautious, shaped by the region’s mixed economic outlook and continued struggles in mainland China.
Japan Leads the Charge
If APAC has a stabilizing anchor, it’s Japan—namely Tokyo and Osaka, which continue to attract global investors for their security, liquidity, and market maturity.
Logistics: The Star Performer
Limited supply, relentless e-commerce demand, and the need for modern distribution hubs have kept logistics valuations elevated.
Hospitality & High-Street Retail: A Tourism Boom
Japan’s tourism revival has pushed hospitality and retail into flourishing territory, with visitor spending reshaping asset performance.
Residential: Slow, Steady, and Consistent
Urbanization, an aging population, and delayed homeownership are keeping rental housing resilient. Foreign residents are adding momentum.
Office: A Quiet Strength
Contrary to global pessimism toward office markets, Japan’s low vacancy rates and active leasing show continued tenant confidence.
Australia’s Sydney Rides the Rate-Cut Wave
Sydney emerged as one of APAC’s strongest climbers this quarter, powered by the Reserve Bank of Australia’s rate cuts to 3.60% by August.
Investment volumes surged:
- 27.5% quarter-on-quarter
- 33.8% year-on-year
This injection of liquidity revitalized activity in industrial and retail, solidifying Australia’s status as a “core APAC haven” with dependable, risk-adjusted returns. For investors seeking stability in a turbulent global market, Sydney continues to shine.
Singapore: Small, Steady, and Strategic
Singapore once again proved its role as APAC’s most reliable defensive market, delivering resilient performance across multiple sectors.
Transaction Volumes Nearly Doubled
Despite a minor year-on-year dip, quarter-on-quarter activity almost doubled—an impressive feat for a compact market with limited land.
Key Drivers:
- Political stability
- Tight land supply
- Strong cross-border capital inflows
Sector Highlights:
- Office: Continues to be a top institutional choice.
- Industrial/Logistics: Supercharged by e-commerce and “China plus one” manufacturing relocations.
- Hospitality & Retail: Short-haul tourism is lifting occupancy and RevPAR.
Singapore’s strategy as a hub for high-value activities stands in contrast to Vietnam and India, which absorb lower-cost manufacturing relocations. This dual-track approach is reshaping the region’s economic geography.
The China Problem
The region’s biggest drag remains China. Despite government stimulus, the market continues to suffer from weak sentiment, declining transactions, and investor hesitation.
But APAC’s strength lies in its ability to diversify. With Japan, Australia, Singapore, and even South Korea attracting global capital, investors are reallocating rather than retreating.
Where Investors Are Looking Next
Across APAC, several themes are dominating investor strategy:
Top Target Sectors
- Logistics — Still the strongest structural play in the region
- Rental Housing — Supported by demographic shifts
- Data Centers — Becoming core infrastructure assets
Outlook for 2026: Renewed Optimism
Savills forecasts a stronger recovery in 2026, driven by monetary easing, capital rotation into Asia, and expanding interest in alternative assets and emerging hubs.
For investors with patience, APAC is poised to offer some of the world’s most attractive real estate opportunities in the coming cycle.
