Colliers’ Asia Pacific Report: 2025 Global Investor Outlook report anticipates significant opportunities for cross-border investments and renewed market activity in 2025, highlighting growing optimism in the APAC real estate market.
The report reveals a local investment landscape gearing up for a lower interest rate environment in many markets, following a prolonged inflationary period that kept many investors on the sidelines. Expectations of rate cuts, along with factors such as continued narrowing of pricing and valuation gaps, are expected to help drive transaction volumes in the APAC region, particularly in the office and logistics sectors.
69% of APAC survey respondents intend to allocate more than 30% of their total global assets under management (AUM) to real estate in the next five years. 68% expect regional economic growth to have a positive impact. 67% plan to invest in the region in 2025, as industrial and office sectors continue to be APAC investors’ top choice in 2025. 61% plan to invest in industrial and logistics, office and multi-family/build-to-rent sectors in 2025. 61% of APAC respondents planning to invest in the office sector intend to invest in core or core-plus CBD office assets. Nearly 90% expect their ESG-compliant office assets to achieve some value premium over the next three years.
Positive signals of heightened real estate investments in the APAC region also augur well for India. Coupled with strong domestic economic growth prospects, India looks uniquely positioned to attract both domestic and foreign institutional investments in the coming years. Interestingly, capital inflows from countries in the APAC region have been on the surge in recent years.
India’s real estate sector continues to attract robust institutional investments, underscoring sustained investor confidence. Since 2021, institutional inflows have totaled USD 19 billion, with investment volumes rising each passing year. This growth is fueled by surging demand across core real estate segments. While office assets have driven over 40% of inflows during the last four years (2021-24), both industrial & warehousing and residential sectors are now seeing accelerated momentum in recent years.
Continuing the momentum of the past three years, institutional investments in Indian real estate in 2024 are poised to surpass 2023 levels, driven by robust investments in office, industrial & warehousing, and residential sectors. In the first three quarters of 2024 alone, investments have reached USD 4.7 billion, accounting for 87% of the inflows in the entire year of 2023. This momentum also sets a promising tone for institutional investments across real estate asset classes in 2025.
