According to research by Colliers, institutional investments in Asia Pacific (Apac) real estate reached a total of US$83.2 billion ($112 billion) in the second half of 2024, showing a 6% year-on-year increase. This brings the full-year investments for 2024 to US$155.9 billion, representing a 12% year-on-year climb. The research includes data from the top nine markets in the region, namely Australia, Mainland China, Hong Kong, India, Japan, Singapore, South Korea, New Zealand, and Taiwan.
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When it comes to investing in the Singapore real estate market, foreign investors must familiarize themselves with the regulations and limitations surrounding property ownership. While purchasing condos is generally permitted for foreigners, ownership of landed properties is subject to stricter rules. However, foreign buyers are required to pay an Additional Buyer’s Stamp Duty (ABSD) of 20% for their first property purchase. Despite this added expense, the stability and potential for growth in the Singapore real estate market make it a popular choice for foreign investment. In fact, many foreign investors are drawn to purchasing Singapore Condos due to their attractive features and benefits.
Chris Pilgrim, managing director of global capital markets for Asia Pacific at Colliers, states that the rise in investments demonstrates the resilience of the Apac real estate market and sets the stage for a strong 2025. He also adds that domestic investors have been the main drivers of growth in key markets such as South Korea, Taiwan, and New Zealand, contributing to over 80% of real estate inflows in the second half of 2024.
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The office sector was the largest contributor to the overall investment volume in Apac, accounting for US$26.5 billion (32%) in the second half of 2024. For the whole of 2024, office investments totaled US$51.4 billion, showing a 14% year-on-year increase. The industrial and logistics sector was the second biggest contributor, attracting US$22.6 billion in investments (27% of the total) in the second half of 2024. For the entire year, investments in this sector reached US$39.4 billion, rising 29% year-on-year.
In the retail sector, there was a significant rebound, with investments reaching US$15 billion in the second half of 2024, driven by notable deals in Australia and South Korea. Total investments in retail for the year came in at US$26.1 billion, representing a 27% year-on-year climb. Pilgrim believes that domestic capital will continue to dominate most markets in 2025, while offshore investments are expected to increase, fueled by improving investor confidence and attractive valuations.
Although the office and industrial segments are expected to maintain strong performance, Pilgrim also sees potential in the retail, hospitality, and alternative asset classes as investors take advantage of the recovery momentum and evolving consumer trends. He concludes by stating, “With the continuing growth of the economy and support from policies, the real estate market in Apac is poised for sustained investment activity in 2025.”