Property markets across the region performed well to set the stage for a sustained recovery in coming months. The office segment drove growth in Australia and Korea while China’s impressive economic recovery attracted investors to a mix of commercial properties. Industrial assets held sway in Singapore and Hong Kong, and Japan witnessed the completion of several commercial and residential transactions. China’s economic revival renews investor demand All key Chinese cities saw a flurry of deals in the first quarter as the country’s strong economic performance during a difficult year revived confidence among domestic and foreign investors. While Beijing recorded nine deals in Q1 – more than in the last six months of 2020 combined – Shanghai saw 11 deals, mainly in the office and business park segments.
The heightened activity was aided by the removal late last year of double stamp duty on commercial transactions. A new government initiative to encourage the redevelopment of industrial buildings will also support the market in the months ahead. Industrial subsectors such as logistics and data centers will continue to attract long-term capital while the residential segment will see growing interest from developers keen to make the most of resilient prices and pent-up demand. Commercial, retail lead the way in Singapore the industrial sector was the highlight of Q1, which saw the announcement of some notable deals following months of negotiations, and volumes climbed 19% QoQ to SGD3.56 billion. Investors are also considering office assets in markets beyond the Greater Tokyo region. Fresh optimism lights up quiet Q1 in Australia, New Zealand Investor confidence continues to improve in Australia and New Zealand, due to a combination of factors such as workers returning to their offices, the rollout of vaccines, low interest rates, and the prospect of international borders reopening soon. In the Sydney CBD, where leasing inquiries jumped to five-year highs, core-plus and value-add investors will become more active while Melbourne will also see more activity, both on and off market.