Commercial real estate investment in the Asia Pacific (APAC) region increased by 20% year-on-year in the second quarter of 2026, reaching US$46.1b, according to MSCI’s latest Asia Pacific Capital Trends report. This growth was observed across major sectors and markets despite challenges such as the US-Iran war and rising borrowing costs.
Retail emerged as the strongest sector, with transaction volumes doubling compared to the previous year, surpassing industrial properties for the first half of 2026. Office and industrial sectors also showed growth, with office investments rising 13% to US$15.7b in Q2. Meanwhile, data centre acquisitions saw a decline, although asset-level activity remained robust.
Benjamin Chow, Head of Private Assets Research for Asia at MSCI, noted the resilience of the market, stating, “The second quarter has firmly put to rest any doubts about the durability of Asia Pacific’s ongoing recovery.” He highlighted the increasing cross-border investment interest, particularly in markets like Japan and Australia.
Singapore and Hong Kong were notable performers, with Singapore’s deal volume rising 61% year-on-year to US$2.2b in Q2. Hong Kong’s activity nearly tripled, driven by office and living sectors. Conversely, South Korea experienced an 18% decline due to interest rate concerns.
Cross-border capital played a significant role, with a 38% increase in deal volume in Q2. Despite potential challenges from inflation and interest rate uncertainties, the robust investment and leasing demand in APAC’s commercial real estate markets offer a hopeful outlook for the remainder of the year.
