Institutional investments in the Asia Pacific real estate market increased 12% year-on-year to reach US$155.9billion in 2024, according to new research from leading global diversified professional services company Colliers. 

According to Colliers’ Asia Pacific Investment Insights H2 2024 report, this growth underscores  the continued resilience of the region’s top nine markets – Australia, Mainland China, Hong Kong,  India, Japan, Singapore, South Korea, New Zealand and Taiwan. 

“The resilience of the Asia Pacific real estate market is undeniable, with institutional investments  rising and demonstrating strong growth last year, setting the stage for a robust 2025,” Chris  Pilgrim, Colliers’ Managing Director of Global Capital Markets, Asia Pacific, said. “Domestic  investors have remained instrumental, driving growth across key markets such as Australia,  Japan, South Korea, Hong Kong, Taiwan and New Zealand, while the office and industrial sectors  continue to lead investment inflows, propelled by strong demand and e-commerce expansion.  

“While investor caution persists in oversupplied markets, confidence is surging in regions like  India, Australia and Taiwan. The resurgence of the retail and hospitality sectors further highlights  the growing optimism across the region, positioning Asia Pacific as a dynamic and resilient  investment destination." 

The office and industrial sectors were key drivers of investment in H2 2024, with the office sector  accounting for 32% of total volume, driven largely by demand in South Korea, Japan, and  Mainland China. The industrial and logistics sector saw a 31% increase, fueled by e-commerce  and supply chain needs, with key markets like South Korea, Mainland China, Singapore, Australia,  and Japan benefiting from strong demand and low vacancy rates. 

The retail and hospitality sectors experienced a significant rebound, with retail investments  increasing 31% year-on-year to US$15.0billion. Both Australia and South Korea saw inflows  exceeding US$3.0 billion in the retail segment, reflecting renewed investor confidence in these  asset classes. 

South Korea, Japan, and Mainland China together accounted for 59% of total real estate  investment inflows in H2 2024. India, South Korea, Taiwan, and Australia saw significant  investment growth, each recording more than 30% year-on-on-year increases.  

The report found real estate investment volumes in the Asia Pacific region were likely to remain  progressive in 2025, buoyed by easing inflation, healthy economic growth prospects and a  potential decline in borrowing costs. 

Mr Pilgrim said domestic capital would continue to play a dominant role across most markets,  while offshore investments were set to increase, led by improving investor confidence and  attractive valuations. 

“The office segment will continue to witness strong momentum, underpinned by robust leasing  and corporate expansions in key markets, and industrial and logistics and residential  investments will remain significant, drawing from long-term stable structural demand,” he said.  “We expect retail, hospitality and alternative asset classes gain traction as the year progresses, as  investors move to capitalise on recovery momentum and evolving consumer trends. 

“With economic growth remaining buoyant and continued policy support, APAC’s real estate  market is poised for sustained investment activity in 2025.” 

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