News release

Real estate investments in Asia Pacific rise 39% year-on-year in first half of 2021

Investment volume in Thailand grows by 20.5%

July 27, 2021

Investment volumes in Asia Pacific commercial real estate reached US$83.5 billion in the first half of 2021, representing growth of 39% year-on-year. Increased investment into the logistics and industrial, office, and retail sectors indicates an ongoing recovery of the region’s capital markets. Volumes in January to June 2021 were down 6% on pre-Covid-19 levels for the same period of 2019, according to JLL’s (NYSE: JLL) Asia Pacific Capital Tracker

China, Australia and South Korea comprised 69% of the total investment volume, while activity in Japan was weaker due to disruptions from Covid-19. JLL analysis of capital flows in the second quarter of 2021 reveals that office, logistics and industrial, and retail investments made up 31%, 30% and 30% respectively.

“Asia Pacific real estate investment is clearly back as investors reaffirmed their positive outlook, ensuring a sizable upswing in year-on-year volumes in the first half. We expect further activity in the second half of 2021 as investors to look to portfolio deals, corporate sale and leasebacks, and seek more diversification into sectors like logistics and industrial, life sciences and multifamily,” says Stuart Crow, CEO, Capital Markets, Asia Pacific, JLL.

Logistics and industrial investments surged by 215% year-on-year in the second quarter to US$15 billion, supported by favourable demand dynamics driven by ecommerce expansion regionally, relative yield spreads and investors’ desire to diversify into more resilient asset classes. Major transactions, including the acquisition of the Milestone portfolio by ESR from Blackstone in Australia, were indicative of demand for high quality logistics and industrial assets in the region.

Throughout the second quarter, office demand improved in most cities, reaching US$15.5 billion in investment. Investors were buoyed by Australian CBD office markets, which recorded positive net absorption for the first time since the fourth quarter of 2019, while office rents turned the corner in Singapore and Shanghai.

Corporate sale and leaseback transactions exceeded 10% of volumes in the first half of 2021, up from an average of 7% in 2015 to 2020. According to JLL, this trend gained momentum in Japan where, since the start of pandemic, more corporates are pivoting toward an asset-light strategy to strengthen their balance sheets. Similarly, in Australia corporations turned to sale and leaseback transactions to unlock value and focus on core business.

Sale and leaseback transactions included the Dentsu headquarters in Tokyo, in the process of being bought by Hulic for up to US$3 billion; and the David Jones flagship store in Sydney, which was sold to Charter Hall for US$374 million (A$510 million) with a 20-year leaseback.

“We expect logistics and industrial investments to double to US$50 to 60 billion by 2025, while at the same time, investors are seeing signs that office markets are stabilising. With ongoing appetite for defensive assets and expected growth avenues like sale and leaseback, we maintain our expectations that investment volumes will rise 15 to 20% in 2021,” says Regina Lim, Head of Capital Markets Research, Asia Pacific, JLL.

Commercial real estate investment volume in Thailand in the first half of 2021 totaled THB 16.6 billion, representing a 20.5% year-on-year growth.

“In line with the regional trend, industrial and logistics investments were a key driver contributing to the growth of transaction volume in Thailand in the first half of 2021. They reached THB 6.7 billion in 1H2021, accounting for 40.3% of the total investment volume,” says Michael Glancy, Country Head of JLL Thailand.

“Despite escalating COVID-19, we expect commercial real estate investment volume to exceed THB18 billion witnessed in 2020, as the fast growth of e-commerce has continued to drive demand in the industrial and logistics sector and hotel investment activity is increasing,” he adds.

About JLL

JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. JLL shapes the future of real estate for a better world by using the most advanced technology to create rewarding opportunities, amazing spaces and sustainable real estate solutions for our clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of $16.6 billion in 2020, operations in over 80 countries and a global workforce of more than 91,000 as of March 31, 2021. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit