Commercial real estate investment across the Asia Pacific surged 18 per cent year-on-year to US$46.2 billion in the first quarter of 2026, signalling strong investor confidence despite mounting geopolitical and macroeconomic uncertainty.
According to the latest survey by CBRE, the region’s investment markets remained resilient, supported by solid occupier fundamentals and continued capital deployment into major gateway cities.
The rebound was powered by strong activity in Singapore, India and Hong Kong, where investors remained active even as global risks intensified.
CBRE’s latest cap rate survey showed sentiment has moderated compared to six months ago, but remains significantly stronger than pandemic-era levels. Leasing demand stayed firm, while investment appetite held steady across most markets.
Cap rates, an important gauge of property returns, continued to reflect highly localised conditions. Australia is facing upward pressure on cap rates, while Japan has limited room for further compression. Meanwhile, China is showing signs of stabilisation and Hong Kong has posted one of the region’s strongest buying intention readings.
Despite resilient fundamentals, geopolitical tensions remain the biggest drag on investor sentiment, especially in South Korea and Pacific markets. Interest rate uncertainty is also weighing on outlooks in the Pacific and Japan.
Still, opportunities are emerging in defensive and structurally supported sectors. Grade A offices have become the region’s most sought-after asset class, while student housing in mainland China is drawing heightened investor attention due to favourable supply-demand dynamics.
CBRE Head of Capital Markets (Asia Pacific) Greg Hyland said investors are re-engaging selectively, prioritising markets and sectors offering stable income streams and long-term growth potential.
Meanwhile, CBRE Head of Research (Asia Pacific) Ada Choi said looking ahead, high construction costs are expected to curb new development starts, tightening future supply and potentially creating attractive medium-term opportunities for investors.