In recent years, the real estate sector has become more transparent in many parts of the world – and the Asia Pacific region is no exception. 

Asia Pacific countries such as Singapore and Hong Kong are home to some of the world’s richest real estate markets. Though they historically tend to lag behind countries in North America and Europe when it comes to real estate transparency, we have seen significant growth in the region in recent years – according to JLL and LaSalle Investment Management’s Global Real Estate Transparency Index (GRETI 2022).

As today’s stakeholders demand more from organisations in terms of higher ethical standards and consistent regulatory treatment, there is no doubt that real estate transparency is more critical than ever for organisations to operate and make decisions with confidence. Real estate transparency gives businesses legal and regulatory frameworks that provide basic property rights and increase accountability and quality of governance for a productive business environment. 

As real estate transparency increases in Asia Pacific, so too will the amount of capital deployed into the region as occupier confidence increases – driven by gains in sustainability, enhancements in regulation and advancements in data. 

1)    Gains in Sustainability

When we talk about real estate, we cannot do so without discussing its impact on the environment. With buildings accounting for 60% of carbon emissions in major cities, the urgent drive towards decarbonisation is leading new transparency requirements. Sustainability has become the new marker of transparency as stakeholders prioritise net zero targets and seek regulatory standards to measure their environmental impact and risk.

According to GRETI 2022, Japan moved up the leader board to join the ‘Highly Transparent’ tier of markets for the first time ever – putting the country alongside Anglophone and European markets who have typically dominated the category. This was boosted by Japan’s initiatives to enhance climate risk reporting and meet sustainability targets as well as improvements in data availability, particularly for alternatives sectors like life sciences, self-storage and senior housing. 

2)    Enhancements in Regulation

Enhanced regulatory initiatives have also helped Asia Pacific countries make strides in real estate transparency improvements.

In South Asia, India has consistently registered amongst the Top 10 Global Improvers in the last two iterations of JLL’s biannual GRETI report. In addition to increased institutional investment and the maturing real estate investment trust (REIT) segment – which helped increase the quality and availability of market data – regulations like the Model Tenancy Act and digitalisation of land registries in India have also helped the country improve its standing. 

3)    Advancements in Data

The acceleration of technology adoption has transformed real estate data gathering and analysis. Buildings today are fitted with technology and sensors to generate real-time data on office utilisation rates. The ease of collecting and processing data is also critical in enabling and accelerating countries’ progress towards greater real estate transparency.

The launch of a new Green Building Masterplan, for example, has helped Singapore forge forward and pull ahead of Hong Kong – thanks to deeper data coverage and clear sustainability commitments. Both countries are now on the verge of entering the ‘highly transparent’ tier of markets, propelling our region forward in the real estate race to transparency.

As Asia Pacific’s commercial real estate sector continues to mature, it will become more accommodating for investors and occupiers who are planning to grow in this part of the world. Even amidst the ongoing pandemic and recession fears, the region’s potential is promising – and investor interest is likely to intensify as our markets make strides towards greater transparency.