Asia-Pacific’s commercial real estate sector has bounced back strongly, recording an unprecedented investment volume of $63.8 billion in Q3 2025 — the highest level ever achieved in a single quarter. The surge represents a 56.8% increase compared to the same period last year and nearly double the volume recorded in the previous quarter.
According to Knight Frank’s latest Capital Markets Insights report, the remarkable growth was driven by several large-scale transactions and the completion of deals that had been delayed due to longer due diligence processes earlier this year.
So far in 2025, total investment volumes have already reached 80% of 2024’s full-year total, putting the region on track to surpass $195 billion by year-end — a projected 10% year-on-year rise.
The renewed momentum is being fuelled by improving policy clarity, stabilising capitalisation rates, and a shift in investor focus from speculative gains to long-term income growth. Much of the capital flow is being directed toward strategic and resilient sectors, particularly the living and logistics segments, which continue to attract institutional investors.
Cross-border investment has also seen a remarkable rebound, totalling $17.8 billion in Q3 — a 72.1% rise from the previous quarter and up 28.6% year-on-year.
Among the standout markets, Australia led with $5.0 billion in foreign inflows, largely targeting residential and industrial assets. Japan followed with $3.5 billion, focused on office and multi-family properties, while South Korea drew $2.3 billion, mainly into industrial and office spaces.
Notably, South Korea emerged as the regional leader, registering $14.3 billion in overall transactions — up 93.6% from a year ago. Office assets made up nearly 71% of its total deals, as sellers capitalised on strong demand before an expected central business district oversupply.
With market sentiment strengthening and investors showing renewed confidence, Asia-Pacific’s real estate landscape appears poised for one of its most dynamic years yet.
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