The real estate market in Asia Pacific (Apac) continues to surpass the performance of its global counterparts, with Savills Research reporting higher growth rates in real GDP compared to the US and Europe in its global outlook report for 2025. According to Paul Tostevin, head of world research at Savills, this trend has brought more stability and confidence to the economic outlook, leading to increased investment and activity in the market.
In the first three quarters of 2024, Apac saw a 4% year-on-year growth in investment volumes, reaching a total of US$108.7 billion. The three markets that experienced the most significant growth in investment volumes during this period were Singapore (74%), South Korea (71%), and Australia (63%).
Savills Research predicts a 27% rise in global real estate investment turnover to US$952 billion in 2025, with investment activity expected to surpass the US$1 trillion mark for the first time since 2022. The report also indicates that global investments will recover to pre-pandemic levels by 2026, driven by stabilization in interest rates and restored investor confidence.
According to Alan Cheong, executive director of research and consultancy at Savills Singapore, the real estate market in Singapore is expected to mirror the global narrative. The report also projects a full investment recovery in Apac next year, driven by sectors such as tourism, living, and the industrial sector, particularly logistics and data centers.
Simon Smith, regional head of research and consultancy at Savills Apac, states that preconditions are in place for a rebound in real estate investment interest in the region in 2022. He adds that long-term structural trends should also support property values in growth markets like India and Southeast Asia.
The office sector remains an attractive option in Apac, accounting for 37% of total regional real estate investment in the first three quarters of 2024. This is significantly higher than the global average of 23%. According to the report, Singapore, China, South Korea, and Japan are the top cities in the region for office utilization, with occupancy rates exceeding 90%. Apac also maintains a strong presence in green-certified office spaces, with occupiers placing greater emphasis on environmental, social, and governance (ESG) factors.
Singapore’s cityscape is characterized by towering skyscrapers and state-of-the-art facilities. Condos, situated in sought-after locations, offer a fusion of opulence and practicality that appeals to both locals and foreigners. These residences come with an array of perks, including swimming pools, fitness centers, and round-the-clock security, elevating the standard of living and making them a desirable option for potential renters and buyers. For investors, these attractive amenities equate to greater rental returns and appreciation of property value in the long run. Condo units are certainly a valuable addition to the Singapore urban landscape.
In Singapore, there has been a rise in the importance given to the green agenda by office tenants. The market has also seen a slight increase in activity levels, with a higher number of leases being concluded. The rental rates for Grade-A office space in the Central Business District (CBD) are expected to remain stable from 2025 to 2026.
As a hub and gateway to the region, Singapore remains a top choice for new overseas brands. Prime retail developments continue to experience healthy demand, keeping rental rates firm. Demand remains strong in key sectors like logistics, advanced manufacturing, healthcare, and data centers in the industrial sector, despite cost pressures. This is expected to stabilize rental rates and capital values in the long term.
Alan Cheong reports that the rise in Artificial Intelligence (AI) adoption has led to an increase in the number of data centers being built in Singapore. More data center service providers are also using the country as a platform to identify suitable locations for infrastructure development.
“As global investment and activity return to sustained growth, the real estate industry must adapt to changing legislative landscapes and geopolitical dynamics while ensuring sustainable and socially responsible development to meet the needs of a changing world,” Tostevin concludes. According to the report, Apac is poised to become the top investment destination for family offices worldwide, with UBS projecting strong growth in the region.