2018亚太区房地产市场展望（英文版）_32页_10mb

2018 Asia Pacific Real Estate Market Outlook Summary

Core Content

The 2018 Asia Pacific real estate market outlook highlights the region's economic and sector-specific dynamics, focusing on office, retail, logistics, and capital markets. The report provides forecasts for rental growth, investment trends, and the evolving strategies of occupiers and landlords.

Key Economic Outlook

• GDP Growth: The Asia Pacific region is expected to grow at 4.5% in 2018, slightly below the 4.7% recorded in 2017, due to the slowdown in China.
• Global Outlook: The global economy is projected to grow at 3.2% in 2018, with the Eurozone and U.S. showing strong growth, which will support Asian exports.
• Inflation and Interest Rates: Inflation remains subdued at 2% or below, limiting the pressure for major interest rate hikes. Most markets will see one or two hikes, with China, Japan, and Australia likely to maintain flat rates.
• Monetary Policy: The U.S. and China will see new central bank leadership, but policy is expected to remain stable. The PBoC will continue deleveraging reforms, while the BoJ may extend its zero rate policy.
• Key Risks: Geopolitical tensions in North Korea, a potential faster downturn in China, U.S. interest rate hikes, and the volatility of cryptocurrencies pose risks to the region.

Office Market Outlook

• Leasing Demand: Office leasing demand is expected to remain stable, with activity driven by tech and financial sectors.
• Demand Drivers: Asian institutions will be the main drivers of demand, with wealth management firms emerging in Hong Kong. Co-working spaces will continue to be a niche but growing segment, though some consolidation is expected.
• Supply Trends: New Grade A office supply is set to reach an historical high of over 60 million sq. ft. NFA, with India and China leading the supply increase. Most supply is outside CBDs, which will keep prime rents stable.
• Rental Growth: Regional rental growth is expected to slow, with Singapore and selected Australian markets outperforming. In Shenzhen and Tokyo, the rental downward cycle is expected to begin.
• Workplace Trends: The workplace is becoming a key factor in the war for talent, with a greater emphasis on flexibility, collaboration, and employee amenities. Activity-based Working (ABW) is gaining traction, especially among multinational occupiers.

Retail Market Outlook

• Leasing Demand: Retail leasing demand is expected to remain stable, with growth driven by prime properties and omni-channel strategies.
• Rental Growth: Overall rental growth is forecast at 0.3%, with prime properties outperforming lower quality assets. Sydney will see a significant slowdown in rental growth due to high rents and weak retail sales.
• Retail Trends: Retailers are increasingly adopting omni-channel strategies, integrating online and offline sales for a seamless experience. F&B and entertainment retailers will lead demand, while luxury brands will remain cautious in Mainland China, Hong Kong, and Japan.
• Store Evolution: Bricks-and-mortar stores are shifting from transaction hubs to experiential spaces. Pop-up stores and signature stores in iconic locations are gaining traction.
• Tenant Strategy: Landlords are advised to focus on high-impact tenants and experiential retail. Data analytics and interactive events will play a critical role in attracting and retaining shoppers.

Logistics Market Outlook

• Rental Growth: Logistics rental growth is expected to increase to 1.7%, driven by the expansion of e-commerce and the demand for shorter delivery times.
• Last-Mile Logistics: The focus on last-mile delivery will drive demand for urban logistics space, such as multi-storey warehouses in densely populated areas.
• India Exception: The implementation of the Goods and Services Tax (GST) in 2017 is expected to reduce operating costs, enabling consolidation of smaller facilities into larger ones.
• Supply and Demand: New supply will exert limited downward pressure on rents, with Greater Tokyo, Greater Seoul, and Sydney seeing increases in new supply. China tier I cities will continue to drive growth, but suburban and satellite town spaces may become more attractive to occupiers.
• Technology Adoption: Logistics occupiers are expected to adopt new technologies to improve efficiency and competitiveness.

Capital Markets Outlook

• Capital Value Growth: The Asia Pacific real estate sector is expected to see 1.8% growth in all sectors.
• Investment Trends: Investment demand remains robust, with funds and institutional investors leading the market. Income growth is becoming the main driver of capital value appreciation.
• Portfolio Management: There is a growing focus on asset management to increase rental income. Landlords and investors must understand occupier trends to make informed decisions.

Summary of Key Points

• Economic Growth: Asia Pacific GDP growth is expected to be 4.5%, slightly lower than 2017, due to the China slowdown.
• Office Market: Office leasing demand is stable, with core+flexible strategies becoming more prevalent. Singapore and Australia will outperform, while China and India face oversupply pressures.
• Retail Market: Retail sales are expected to grow at 3.9%, with e-commerce continuing to influence the sector. Omni-channel strategies and experiential retail are key trends.
• Logistics Market: Logistics rental growth is expected to rise, driven by e-commerce expansion and last-mile delivery needs. Urban logistics and technology adoption are critical for future growth.
• Capital Markets: Capital value growth is driven by income growth, with a focus on portfolio optimisation and asset management.

Conclusion

The 2018 Asia Pacific real estate market is expected to experience moderate growth across all sectors, with office and retail markets facing slower rental growth and logistics showing increased demand. Technology integration, flexible working environments, and omni-channel retail strategies are reshaping the market landscape, while geopolitical risks and economic uncertainties remain key concerns. Landlords and investors must adapt to these changes to remain competitive and meet the evolving needs of occupiers.