- Asia Pacific commercial real estate investment reached a record USD $92.5 billion in the first half of 2026, a 35% year-on-year increase, according to JLL data. Japan led the region with USD $10.6 billion in the second quarter, while Australia, Singapore, and Hong Kong all posted sharp volume gains driven by large portfolio and landmark transactions.
- Investors showed a preference for sectors perceived as resilient, including offices in supply-constrained core cities and data centres supported by artificial intelligence demand. South Korea remained subdued due to a gap between buyer and seller price expectations, while India saw growth led by office assets and domestic institutional capital.
Commercial property dealmaking across the Asia Pacific climbed to unprecedented levels in the first half of 2026, with investors pushing capital into the region despite headwinds from rising energy costs, currency swings, and supply chain strain, according to new data from JLL.
Asia Pacific commercial real estate investment volumes rose 38% year on year to USD $45.5 billion in the second quarter, JLL reported. That brought first-half volumes to a record USD $92.5 billion, a 35% increase from the same period a year earlier.
Japan remained the region’s largest market in the quarter, with investment volumes of USD $10.6 billion, as activity increased across all major property sectors.
Core investors concentrated on office assets, while value-add buyers targeted industrial properties offering rents below market rates. Data centre demand in Japan stayed strong, underpinned by domestic data sovereignty policies and investment tied to generative artificial intelligence, a sign that technology-linked property continues to draw capital even amid broader geopolitical uncertainty.
Australia recorded USD $8.9 billion in second-quarter investment, up 82% year on year and its strongest quarterly total since the second quarter of 2021.
Four large portfolio transactions drove much of the growth, with listed REITs, unlisted trusts, developers, and private investors active in the industrial sector, while retail assets also drew renewed buyer interest.
Singapore recorded one of the region’s sharpest jumps. Second-quarter volumes rose 108% year on year to USD $6.7 billion, driven largely by two major deals: CICT’s USD $3 billion acquisition of Paragon Mall from Cuscaden Peak, and IOI Properties’ USD $1.9 billion purchase of Asia Square Tower 2 from CICT.
Hong Kong posted the fastest growth rate in the region, with volumes up 129% to USD $3.1 billion, fuelled by a recovery in retail and office deals, including several linked to assets under receivership.
India’s market, though smaller in absolute terms, expanded as well, with second-quarter volumes reaching USD $1.6 billion, up 23% year on year, led by office assets, where investment volumes rose 125% on the back of domestic funds, developers and REITs.
Investors Turn Defensive
Across the region, investors continued favouring sectors and markets seen as more resilient, with uncertainty expected to remain a defining feature for the rest of the year.
Offices held up particularly well in core cities, where limited new supply supported pricing and rents, with demand shaped more by asset quality than by commodity or energy costs.
Data centres were also viewed as relatively insulated from geopolitical tensions, with demand tied to artificial intelligence and cloud spending staying stronger than expected even as broader capital expenditure turned more cautious.
South Korea, meanwhile, remained a market where elevated interest rates continued to widen the gap between buyer and seller expectations.
Stuart Crow, Chief Executive Officer of Asia Pacific Capital Markets at JLL, said the scale of transactions this quarter shows that capital remains abundant even as investors navigate a difficult geopolitical backdrop. He added that the return of mega-deals in both office and retail demonstrates that large global investors are capitalising on repriced premier core assets.
Pamela Ambler, Head of Investor Intelligence for Asia Pacific at JLL, said investors are pivoting toward sectors with strong structural demand, such as data centres in Japan and logistics in Australia, or toward assets offering quicker yield stabilisation, such as Hong Kong’s recovering office market.
