Insight
Invesco Real Estate House View - Asia Pacific Market Outlook H2 2022

Below is an excerpt from the Invesco Real Estate House View - Asia Pacific Market Outlook H2 2022. The full outlook is available on this dedicated webpage.
Asia Pacific real estate investment context - H2 2022
Post-Covid recovery; rising borrowing costs
Macro environment
- Economic backdrop: key economies in the region except China and Hong Kong have re-opened borders and experiencing a post-COVID recovery.
- Occupier fundamentals: despite the "feel good" sentiment of post-COVID, global economic uncertainty is keeping business expansion in check.
- Capital markets: investment activity is expected to be muted in most markets amidst rising borrowing costs.
Asia Pacific investment execution response 2023-24
Industrial / logistics
- Remain a focus.
- Last-mile warehouses and cold storage in Australia, Japan and Korea enjoy structural tailwinds and signs of repricing emerge in Australia and Korea.
Residential
- For lease residential (smaller units) in key metros of Japan.
- Build-to-rent in Sydney and Melbourne, Australia as potential buyers may turn to rent amidst rising mortgage lending rates.
Others
- Performance of Japanese hotels could rebound sharply as borders open.
Defensive execution and sharp asset selection
- Conservative financing and leasing assumptions amidst uncertainties.
- Widening performance gaps between top and bottom performers indicate the importance of asset selection.