APAC Real Estate Investment Sees 6% Decline in First Half of 2025
Real estate investments across nine major Asia-Pacific (APAC) markets reached USD 71.9 billion in the first half of 2025, marking a 6 per cent year-on-year decline, according to Colliers’ Investment Insights H1 2025 report released in September. The research, covering Australia, Mainland China, Hong Kong, India, Japan, Singapore, South Korea, New Zealand, and Taiwan, attributes this dip to ongoing global trade volatility and broader economic headwinds. However, the sector is anticipated to gain momentum in the second half of the year as interest rates stabilise and domestic capital remains robust.
India Strengthens Position in Global Real Estate Landscape
Despite the modest slowdown, India has fortified its standing within the regional investment landscape, ranking fourth globally as a destination for cross-border capital into land and development sites, as per Colliers’ Global Capital Flows Report – September 2025. The report also highlights that seven of the top ten global destinations for land and development investments are situated in APAC, underscoring the region’s escalating importance in global real estate capital flows.
In India, real estate investments totalled approximately USD 3 billion in H1 2025, reflecting a 15 per cent year-on-year decline. Nevertheless, investor interest remained vigorous, bolstered by both foreign and domestic capital. Foreign investments accounted for about USD 1.6 billion, or 52 per cent of institutional inflows, while domestic capital deployment surged 53 per cent year-on-year, contributing nearly 48 per cent of total investments during this period.
Insights from Colliers India Leadership
Badal Yagnik, Chief Executive Officer of Colliers India, remarked, “India continues to stand out as a promising country within Asia Pacific’s real estate investment landscape. Foreign investments remained strong at USD 1.6 billion and accounted for around 52 per cent of institutional investments in India during H1 2025. APAC investors contributed more than one-third of these inflows, reaffirming India’s strategic importance in cross-border capital flows.”
He added that robust demand for high-quality spaces, ongoing simplification of GST regulations, and expectations of heightened consumption during the festive season are bolstering investor confidence. According to Colliers, real estate investments in India are likely to conclude 2025 on a strong note, with core segments such as residential and office assets continuing to attract significant capital.
Investment Trends Across APAC and India
Across the APAC region, office assets remained the most preferred investment class, accounting for 36 per cent of total investment volumes in the first half of the year, with South Korea and Japan leading activity in this segment. Retail investments rose 13 per cent year-on-year, driven by transactions in Australia, South Korea, and Mainland China, reflecting renewed investor confidence in income-generating retail assets.
Within India, residential and office assets together accounted for more than half of all real estate investments during H1 2025, with residential projects attracting around USD 0.8 billion. Institutional investors have increasingly partnered with local developers to acquire or develop office projects, signalling sustained long-term confidence in the country’s commercial real estate sector.
The report also highlights a sharp increase in investment interest in mixed-use and retail developments in India, which together accounted for over 30 per cent of total investments, compared with just 7 per cent during the same period in 2024. This growth mirrors the rising popularity of integrated developments that combine residential, retail, entertainment, and lifestyle spaces, particularly in high-density urban areas.
Future Outlook and Diversification
Vimal Nadar, National Director and Head of Research at Colliers India, noted, “India’s prominence in the Asia Pacific region continues to grow, driven by strong demand traction across real estate asset classes.” He emphasised that favourable policy measures, improving yield spreads, and increasing investor appetite for portfolio diversification are supporting long-term growth in the country’s property market.
Looking ahead, Colliers expects investment activity across APAC to improve in the second half of 2025, supported by easing inflation, stable monetary policy, and improving yield spreads. Investor interest is also gradually expanding beyond traditional asset classes to alternative segments such as data centres, senior living, and life sciences, indicating an evolving and more diversified real estate investment landscape across the region.
