Asia Pacific Commercial Real Estate Investment Declines in Q2 2025 but Leasing Market Remains Active

According to CBRE’s latest data, Asia Pacific commercial real estate investment volume dropped by 19 percent quarter-on-quarter but increased by 15 percent year-on-year to US$31.2 billion in Q2 2025, as the second quarter was impacted by global trade tariff uncertainty.

Retail investment showed the strongest performance this quarter, increasing by 58 percent q-o-q. Mainland China recorded the highest volumes in Q2 2025 in APAC, followed by Japan. 

“Momentum in investment activity is building in Asia Pacific, with debt costs continuing to fall and positive carry returning to most markets. Activity is expected to remain strong in the second half of the year,” said Greg Hyland, Head of Capital Markets, Asia Pacific, CBRE.

“Despite occupier sentiment turning cautious in Q2 amid macroeconomic uncertainty, demand for CBD office space and prime retail locations across Asia Pacific remains robust, demonstrating strong preference for prime locations," said Ada Choi, Head of Research, Asia Pacific, CBRE. “Meanwhile, we expect investment volume to gain momentum as interest rates continue their downward cycle.”

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CBRE’s Asia Pacific Trends Q2 2025 features in-depth insights on the Investment, Office, Retail, Industrial & Logistics, and Hotel markets across the region. Below are the key highlights: 

Investment

Investment activity in India remained robust in Q2 2025, led by developers, international private equity players, and domestic capital. The buyer pool in Hong Kong SAR remained largely dominated by end-users and domestic investors. In Taiwan, industrial investment continued to dominate transaction activity, with the sector comprising some 90 percent of investment volume during the quarter. CBRE expects strong investment activity in Asia Pacific to continue in the second half of the year. 

Office

The demand for CBD office space in Asia Pacific remains solid, as occupiers are undeterred by geopolitical turbulence. Despite slower demand and supply pressure, CBRE is observing numerous bright spots, including flight-to-quality leasing activity in Australian CBDs and robust office demand in the Middle East due to tight availability.

Retail

Leasing demand in Vietnam remained strong amid an influx of new entrants from mainland China. Demand held firm in Singapore as retailers cautiously expanded in anticipation of slower consumption. Retail leasing activity in India improved after a slow start to year, backed by positive domestic consumption. Retailers’ need for expansion is generating spillover demand for non-CBD space due to limited options in CBDs and other core locations.

Industrial & Logistics

Trade policy-related disruption in recent months has compelled industrial occupiers to analyse real estate plans more cautiously. Singapore, Japan, and Australia are demonstrating resilience, supported by stable demand amidst new / normalising supply scenarios.

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Hotel

Investors continued to display a robust appetite for hotel acquisitions in Q2 2025, backed by steady growth in visitor arrivals and solid operating performance. Despite tight availability in some markets, CBRE expects strong investment momentum to continue into H2 2025.