October 19, 2016

Asia Pacific Capital Markets in Focus – October 2016.

Regional Highlights/Outlook: 

  • Investors increasingly look for to value in off-market deals, newer/secondary cities as well as newer sectors. Asset-specific strategy may be needed going-forward
  • Cap rates have compressed to record low in some markets on the weight of capital chasing assets, but positive spreads to risk free rates remain
  • Slower growth year-to-date in AP-focused fund fundraising but record dry powder levels remain

Market Conditions:

  • Transaction volumes in Q3 2016 were up 5% y-o-y to USD 33.1bn. China and Singapore were up y-o-y, but Australia and Japan were weaker as owners held onto stock. Deals volumes in the first nine months were stable at USD 86.6bn
  • Cross-border investors remain active on both sides of the ledger, accounting for 31% of Q3 total
  • Intra-regional purchaser capital flow within the region trended slightly higher in Q1-Q3. Capital flow by inter-regional purchasers regionally have fallen y-o-y

Market Fundamentals: 

  • Office | Rents grew in most markets but mixed demand by city. Demand momentum slowed in Q3
  • Retail | Retailers are expanding in Australia but cautious towards expansion across most of Asia
  • Industrial | Demand is supported by 3PLs & e-commerce in Asia, and retailers in Australia
  • Residential |Sales improved in Greater China and Singapore but slowed in Australia in
  • Hotels |Diverse trading performance. Still strongest showing in Tokyo and Australia

For more, including investment deal highlights and city analysis across Asia Pacific, download our Capital Markets in Focus Report.


Myles Huang

Asia Pacific Capital Markets Research Drector, JLL

Never miss an update from The Investor.

Subscribe Now!