Written by: Roddy Allan, Chief Research Officer, Asia Pacific at JLL
2024 was a year of consistent upside for the Asia Pacific CRE sector. Investment-wise, there were four consecutive quarters of annualized growth, bringing full-year investment volumes to US$ 130.4 billion, a 22% year-on-year (YoY) increase.
Growth sources were diversified. The US Federal Reserve’s first interest rate cut in 4 years helped. Furthermore, record hotel transaction volumes from travel returning to pre-pandemic levels, and sustained momentum in investor appetite for data centers in the region, fueled by rapid AI development and demand for cloud computing infrastructure, also influenced sentiment.
From an investor and occupier perspective, considerations such as AI and sustainability will continue to be top-of-mind for decision-making and capital allocation as cost pressures and energy security become key threats in a world with growing economic and political uncertainty.
Looking towards 2025, we expect to see the following bright spots for the CRE sector in Asia Pacific.
- As the office becomes central to organizations, hyper personalization of workplaces is expected to become a top priority for CRE leaders.
From our research, 44% of organizations can be characterized as ‘Office advocates’, who would like to see staff in the office five days a week, citing reasons such as improved communication and collaboration, and better productivity. This compares to just 34% of employees working full time in the office in 2022. This shift away from the hybrid work model that was normalized following the pandemic means one thing – organizations cannot afford to ignore the importance of designing an office that will keep employees engaged and productive.
The transition of the office to a vital instrument for organizational success necessitates a fundamental rethinking of workplace design, moving away from one-size-fits-all solutions towards hyper-personalization to support diverse workstyles. CRE leaders can create a more engaging and fulfilling work experience through optimizing space utilization and conscious workspace design to enhance employee productivity and prioritizing employee wellbeing.
For example, JLL recently worked with a global food processing company to design a sustainable, wellness-focused workplace. To design a personalized yet customizable space, our design team utilized modular furniture that can be easily reconfigured to suit different work styles and activities, accommodating any event from formal townhall gatherings to quick and casual discussions. For sustainability, we assessed different metrics such as energy usage, indoor air quality, sustainable operations, and addition of green design features, ensuring that the client’s new office adheres to Green Mark standards.

Source: JLL
- Tourism in Asia Pacific expected to continue upward trajectory, boosting investment into hotels sector.
According to data from global market intelligence provider BMI, tourism arrivals for Asia are expected to recover to their pre-pandemic levels in 2025, marking a 4.7% rise from 2019, driving plenty of optimism for the hotels and hospitality sector. From our research and analysis, we expect hotel transaction volumes to reach US$ 12.8 Billion in Asia Pacific in 2025, a 5% forecasted growth from 2024. This growth will be led by Japan, Mainland China and Australia, traditionally the most liquid markets in the region.
In 2024, Japan set a new annual record for visitor arrivals, reaching 33.4 million arrivals in the first 11 months of 2024, propelled by the weak yen. This drove several major hotel transactions in Japan, such as the acquisition of the Grand Nikko Tokyo Daiba from Hulic Co, by global alternative asset management firm TPG Angelo Gordon for $691 Million in October 2024, which was the biggest deal of the year in Asia Pacific.
Singapore has also emerged as a mega-entertainment event hub, playing host to A-list artistes such as Taylor Swift, Ed Sheeran, and Bruno Mars in 2024 alone, just to name a few. That is expected to have a trickle-down effect and drive growth opportunities across the region. The filming of HBO series The White Lotus in Thailand is also expected to significantly boost tourism in Thailand this year.
Cross-border investment, which has been the main capital source for hospitality investments in Asia Pacific in 2024, is expected to continue to grow, along with family offices allocating more capital towards hotel assets in an environment of higher inflation and interest rates today.
- Decarbonization will no longer be just an ESG consideration, but a critical component of operational and risk management.
As the global Net Zero Carbon (NZC) imperative looms and decarbonization becomes front and center for occupiers, the surge in demand for sustainable buildings is expected to result in a significant supply-demand gap, fostering fierce competition among occupiers for low carbon buildings by 2030.This is because capital expenditure invested in optimizing energy use and reducing emissions in buildings results in lower operational costs, secure energy, regulatory resilience and improved employee attraction.
In APAC, we are already moving towards decarbonization – currently, only 4% of occupiers in Asia have 100% green certified portfolios, but this number is expected to grow to 87% by 2030. Regulation is similarly evolving in the same direction. Singapore, for example, requires all listed companies to make climate-related disclosures starting from the financial year (FY) of 2025, followed by large non-listed firms two years after that. China is also aiming to establish a national standard for corporate sustainability disclosure by 2030. Industry action, coupled with regulatory changes, affirm the region’s growing prioritization of decarbonization and its evolution to becoming an integral part of business operations.
The way forward for Asia Pacific CRE
The CRE investment landscape in APAC is expected to continue to see strong growth in 2025, building on the positive momentum in 2024 across all sectors, underpinned by Southeast Asia’s strong position as a global data center hotspot and the region’s tourism boom. We can also expect to see an increase in allocation of private wealth towards CRE in a world of increasing geopolitical tensions today, with CRE viewed as a safe haven asset amid market uncertainties.
In times of uncertainty, real estate transparency will also become especially critical in driving sustained growth, with ‘Highly Transparent’ markets accounting for over 80% of global CRE investment, according to JLL’s Global Real Estate Transparency Index (GRETI) 2024 report. AI and sustainability are among the key pillars to transparency, and it will be interesting to watch how their symbiotic relationship develops. With our research showing that countries in Asia have recorded the strongest average transparency improvements since 2022, there is certainly much cause for optimism.
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