How Asia-Pacific property markets are drawing fresh capital despite US rate uncertainty
Property markets in the Asia-Pacific region are likely to remain attractive despite heightened uncertainty over monetary policy after the US Federal Reserve delivered its first interest rate increase in more than three years this month, analysts say, with several asset classes and sectors expected to draw investor interest. “We’ve seen volumes, specifically cross-border volumes in the region,…
The Asia-Pacific property markets are expected to remain appealing to investors despite recent monetary policy changes in the United States, according to analysts. In the first quarter of 2026, mainland China saw a surge in real estate investment, up 154% year-on-year to $13 billion, while Japan and Australia followed with $9.7 billion and $8 billion respectively. Hong Kong, despite its dependence on US monetary policy, recorded the highest growth at 172%, with $2.5 billion in deals.
Office properties were the top investment asset class, attracting $15.7 billion, followed by retail at $11.9 billion and industrial at $9.7 billion. Savills senior director Emily Fell highlighted the Sydney co-living segment and South Korea's senior living assets as promising areas for growth amid policy uncertainty. Fell noted that the Sydney CBD is ideally situated for this sector due to favorable planning regulations, tax incentives, and a high demand pool.
South Korea's rapidly aging population is creating unique investment opportunities, with Fell predicting strong growth in this sector over the next decade. A notable deal in March involved Hyundai Haim Asset Management, backed by Hyundai Marine and Fire Insurance, which acquired a senior living complex site in Seoul for $368 million.
Hong Kong, closely aligned with US monetary policy, is likely to continue attracting capital from investors seeking bargains, according to Neil Brookes, head of Asia-Pacific capital markets at Savills. Brookes pointed out that many buyers are drawn to the substantial discounts (40-50%) available on previously high-priced assets.
Southeast Asian investors have emerged as the largest non-local buyers of Hong Kong commercial property this year, contributing over 11% of the total value. Global real estate consultancy JLL Capital Markets' Tim Graham emphasized that the fundamentals of Asian property markets remain strong, particularly office markets with limited development pipelines and strong rental growth prospects.
Graham attributed this resilience to robust GDP growth and demographic trends, which are not influenced by US monetary policy decisions.
Written by urgent.news from South China Morning Post's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
