Industrial and logistics most sought-after real estate assets in Asia-Pacific in 2022: Colliers

INDUSTRIAL and logistics (I&L) assets will be the most sought-after real estate assets in the Asia-Pacific region next year, while core and core-plus office spaces are the top investment preference for investors globally, consultancy Colliers said in its 2022 Global Investor Outlook Report.

With cross-border capital flows likely to return following the progressive resumption of travel and business activity, more investors are expected to put delayed investment plans into action in the new year.

"Optimism across the Asia-Pacific region continues to gather momentum and investors have a clear appetite to expand their portfolios," said Terence Tang, Colliers' Asia managing director of capital markets and investment services. "Transaction volumes are recovering back to their pre-Covid highs, and asset operating performances remain in a cyclical upswing."

According to the survey report by Colliers, I&L assets are the most coveted in Asia-Pacific, with more than 20 per cent of investors anticipating capital value gains of 10 to 20 per cent in value-add I&L assets in 2022.

Core-plus offices remain a popular asset class for regional investors in Singapore, Sydney and Tokyo, the report noted. 63 per cent of respondents indicated that they plan to invest in these assets, as compared with 54 per cent last year. This signals confidence in both the stability and capital growth prospects of these markets, even as organisations experiment with remote and hybrid working models.

The report noted that multifamily properties continues to attract new investors across the region, though access to entry is largely via development in China and Australia. Almost half of those surveyed stated that they are on the lookout for development opportunities, primarily focused on these markets.

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Core and value-add investors will focus on Japan as the only established market, though a small number of those surveyed indicated interest in some of the smaller fragmented multifamily markets including Singapore and Hong Kong.

With ESG (environmental, social, governance) becoming a more important consideration globally, more investors will also be following the shift to decentralised offices, business parks and flex or coworking spaces, said the report.

Tang observed how more office building owners and landlords are working closely with coworking platforms to cater to increasing demand for flex space. "In cities such as Shanghai, Hong Kong and Singapore, we've seen growing demand for business parks. Overall, it's a remarkably resilient asset class," he added.