As occupier sentiment in the Asia-Pacific (APAC) property sectors shifted noticeably, a marked decline was observed in the second quarter of 2025, particularly within the office segment. Recent findings from CBRE’s survey, which included insights from 517 leasing market professionals, indicated a growing caution among occupiers, reflecting the prevailing uncertainties impacting the market. This shift in sentiment was underscored by significant trends in various property sectors, most notably in office, retail, and industrial sectors.
In the office sector, the decline in occupier sentiment was most evident as 24% of respondents reported a decrease in rents, a notable increase from 16% in the previous quarter. This trend demonstrated a growing concern among businesses regarding the viability of office spaces, with only 26% of respondents observing rising rents, a sharp decrease from 38% in the first quarter of 2024. The shift in rental expectations can be attributed to a combination of factors including rising remote work policies, economic uncertainties, and shifting workplace dynamics. As organizations reassess their space requirements in light of these changes, it is clear that the office segment is experiencing a critical transformation.
Meanwhile, the retail sector also faced challenges, primarily due to economic volatility across the region. Although regions like India and Korea reported relatively upbeat sentiment, the overall rental expectations were tempered. Retailers, grappling with changing consumer behaviors and the impacts of digital transformation, exhibited a cautious approach towards leasing decisions. The mixed sentiment in this sector highlights the complexities faced by retailers as they adapt to the evolving landscape, where traditional shopping habits continue to be disrupted.
In the industrial and logistics sector, a significant slowdown was noted, particularly in Greater China. This decline was characterized by a marked decrease in tenant inquiries and inspections, directly linked to ongoing trade disruptions that have affected logistics and supply chain operations. As businesses navigate these challenges, the demand for industrial space has been adversely impacted, leading to a more cautious outlook among occupiers in this segment.
The findings from CBRE’s survey illuminate a broader trend of weakening occupier sentiment across the APAC property sectors, driven by a variety of economic and market factors. The hesitance among businesses to commit to leasing spaces is indicative of the uncertainties that prevail in the region. As companies reassess their real estate strategies, the implications for landlords and property investors could be significant, potentially leading to adjustments in rental pricing and leasing terms.
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News Source: Edgeprop
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