<div id="readability-page-1" class="page">Asia-Pacific’s commercial property investments surged in the first quarter, according to data tracked by analysts, as early signs of recovery in office and retail segments across Hong Kong and mainland China boosted deal volumes. Total investment in offices, retail spaces, industrial units, data centres, hotels, apartments, senior housing and other asset classes climbed 22 per cent to US$51.1 billion from the same period in 2025, data from MSCI showed. Hong Kong contributed US$1.8 billion, a 367 per cent surge, the second-biggest improvement after Singapore’s 439 per cent increase, according to the data and analytics firm. The mainland was the top market, cornering US$13.4 billion, a 55 per cent rise. In the previous quarter, Japan was the top market, accounting for US$10.1 billion out of the US$47.6 billion total. The mainland was the second-largest market with US$8.2 billion. Knight Frank estimated Asia-Pacific investment activity at US$64.6 billion, rising 13 per cent quarter-on-quarter and 65 per cent year-on-year, the strongest quarterly performance since late 2021. “Asia-Pacific’s real estate recovery has gained real breadth in the first quarter and Hong Kong was one of the key markets behind the growth in deal activity,” said Benjamin Chow, head of private assets research for Asia at MSCI. “Deal volumes in the Hong Kong market are still modest in absolute terms compared with the longer run, but investors can draw encouragement from the fact that the market has recovered from its low point and maintained its level of activity up until early 2026,” Chow said. “Corporate and owner-occupier buyers have led the office recovery, and the retail sector is also showing early signs of life.”  One notable Hong Kong transaction was Regal Hotels International Holdings’ agreement with its affiliates in March to sell the 494-room Regal Oriental Hotel on Sa Po Road in Kowloon for about HK$1.52 billion (US$194 million) to the real estate investment arm of Centaline Group, one of the city’s largest property agency networks. The arm plans to convert the property into a student hostel. Among the top investment values in the quarter on the mainland was Bain Capital’s US$4 billion sale of its data centre portfolio company WinTriX DC Group’s China business to a consortium led by Shenzhen Dongyangguang Industry in a deal announced in January. “Outside of data centres, the broader market is gradually transitioning from decline to stabilisation, with retail and hotel volumes both rising in the quarter,” MSCI said. In the second quarter, investment activity in Asia-Pacific was likely to “remain steady but more selective”, according to Knight Frank. “Geopolitical risks, particularly the conflict in the Middle East, could add to inflationary pressures and tighter financing conditions,” the property consultancy said in a report. “A relatively short conflict that concludes in the second quarter would likely delay capital flows modestly and defer cap rate compression by three to six months.” Still, it added, “well-located, core assets in safe-haven markets are expected to continue attracting strong interest”.</div>

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<p>Asia-Pacific's commercial property investments surged 22% to US$51.1 billion in Q1, driven by recovery in Hong Kong and mainland China. Hong Kong saw a 367% increase to US$1.8 billion, while mainland China led with US$13.4 billion, a 55% rise. Knight Frank reported a 13% quarter-on-quarter increase in investment activity, the strongest since late 2021. Notable transactions included Regal Hotels selling a hotel for US$194 million and Bain Capital's US$4 billion data center sale. Future investment may remain steady but selective due to geopolitical risks, particularly in the Middle East.</p>

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Hong Kong, mainland China spur surge in Asia-Pacific commercial property deals