Real estate investment volumes in Asia Pacific up 30% in first nine months of 2021: JLL

By Charlene Chin

/ EdgeProp Singapore |

October 21, 2021 4:23 PM SGT

(Credit: Samuel Isaac Chua/ The Edge Singapore)

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SINGAPORE (EDGEPROP) - Real estate investment volumes in Asia Pacific is up 30% y-o-y for the first nine months of 2021, according to real estate consultancy JLL.

Read also: Asia Pacific cities face the challenge of sustainable growth: ULI’s Khoo Teng Chye

Year-to-date direct real estate transactions in the region reached US$125 billion ($168 billion), “just 6% below 2019 levels as investors deployed capital into more income-resilient assets, such as office and logistics sectors”, it highlights.

In 3Q2021, office investments continued to recover, contributing to 55% of deals made, supported by stabilising rents and occupancy levels, it notes.

Logistics transactions have also continued to climb, with investments in the past 12 months reaching US$43 billion, compared to US$25 billion in 2019. In line with that, JLL expects investments in logistics to double to US$50 billion–US$60 billion between 2023 and 2025, “driven by favourable demand drivers, attractive yield spreads and a desire for diversification”.

Although investments into the retail and hotel sectors have been soft across the region, it expects hotel investment volume to cross US$7 billion for the full year 2021, growing to US$9 billion in 2022.

“Despite ongoing unpredictability, our interactions with clients reaffirm both the attractiveness and resilience of the Asia Pacific commercial real estate sector. Throughout 2021, investor interest in the region has remained extremely high as capital becomes more active and volumes approach pre-pandemic levels across the region, which we expect will continue into the fourth quarter,” says Stuart Crow, CEO, capital markets, Asia Pacific, JLL.

“We expect portfolio reallocation to remain a major theme into 2022 with investors facing stiff competition for income-resilient assets including office and logistics, as well as in more niche sectors such as self-storage, residential and data centres”, notes Regina Lim, head of capital markets research, Asia Pacific, JLL.

“Overall, investor sentiment remains positive and we maintain our view that investment volumes will rise 15% to 20% in 2021 with further recovery expected in 2022,” adds Lim.

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