In the second half of 2024, institutional investments in real estate in the Asia Pacific (Apac) region reached a total of US$83.2 billion ($112 billion), showing a 6% increase year-on-year, based on research by Colliers. This brings the full-year investments in 2024 to a total of US$155.9 billion, a 12% increase compared to the previous year. These figures include the top nine markets in the region, namely Australia, Mainland China, Hong Kong, India, Japan, Singapore, South Korea, New Zealand, and Taiwan.
According to Chris Pilgrim, Colliers’ managing director of global capital markets, Asia Pacific, the rise in investments demonstrates the resilience of the Apac real estate market and sets the stage for a robust 2025. He also mentioned that domestic investors played a crucial role in driving growth in key markets such as South Korea, Taiwan, and New Zealand, with local investors contributing over 80% of real estate inflows in these countries.
The office sector contributed the most to the investment volume in Apac, accounting for US$26.5 billion or 32% of the total volume in the second half of 2024. For the entire year, office investments amounted to US$51.4 billion, showing a 14% increase year-on-year. The industrial and logistics sector came in second, with US$22.6 billion in investments in 2H2024, or 27% of the total. This brings the total investment in this sector for 2024 to US$39.4 billion, showing a 29% increase compared to the previous year.
The retail sector also experienced a significant rebound, with US$15 billion in investments in 2H2024, driven by substantial deals in Australia and South Korea. The total retail investments for 2024 reached US$26.1 billion, a 27% increase year-on-year. Pilgrim predicts that domestic capital will continue to dominate most markets in 2025, while offshore investments are expected to rise due to improved investor confidence and attractive valuations.
While investments in the office and industrial sectors are expected to remain robust, Pilgrim believes that the retail, hospitality, and alternative asset classes will also see growth as investors take advantage of the recovery momentum and evolving consumer trends. He concludes by saying that with strong economic growth and continued policy support, the Apac real estate market is set for sustained investment activity in 2025.