Asia Pacific Commercial Property Set for Stable Growth in 2025, but Challenges Persist

Looking ahead to 2025, the commercial real estate market in Asia Pacific is poised for steady growth, buoyed by a strong regional economy and a supportive interest rate environment. According to CBRE’s 2025 Asia Pacific Real Estate Market Outlook, although performance will differ across markets and sectors, the region remains attractive for continued investment and leasing activity.

A key trend for investors is the ongoing preference for value-added opportunities, which offer the potential for high returns. The office sector, in particular, continues to be a favoured investment, with Australia, Korea, and Singapore at the forefront. The industrial market, especially in Australia and Seoul, is also expected to see substantial interest, particularly in prime logistics assets. CBRE anticipates a 5-10% increase in investment volumes, with Australia, Korea, and Singapore emerging as primary hotspots. Meanwhile, Japan and India will likely continue to capture investor attention due to sustained interest in the region’s commercial property.

Ada Choi, CBRE’s Head of Research, Asia Pacific, noted that markets across the region are at varying stages in their pricing cycles, leading to different expectations for returns.

In terms of leasing, activity is set to grow modestly, with occupiers increasingly seeking high-quality, sustainable, and wellness-focused office spaces. The “flight-to-quality” trend will drive demand for premium properties, especially in markets like Australia, Korea, and Singapore. At the same time, in areas such as mainland China, India, and Southeast Asia, occupiers will have more flexibility due to the abundance of available office space.

2025 will also see a significant influx of new office supply, with nearly 70 million square feet expected to be completed across the region—the highest level of office space delivery in two decades. While vacancy rates may rise, the demand for prime assets will continue to drive leasing activity. Key cities like Brisbane and Sydney are projected to lead rental growth in their respective central business districts (CBDs). However, markets such as Seoul are expected to experience more moderate growth following a period of steep price increases.

As the Asia Pacific real estate market evolves, CBRE forecasts a gradual recovery in investment activity, with sustained demand for high-quality, sustainable spaces across different asset classes.