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Economic growth and omnichannel expansion to support steady leasing momentum; rental growth set to be driven by prime assets; occupiers advised to secure high quality modern logistics space as supply pipeline escalates.




Trends to Watch

  1. The Rise of Emerging Markets

    Changing consumption patterns driven by the rise in remote-working and growth of omnichannel are increasing the need for warehouse space in residential neighbourhoods, especially in widely dispersed cities. At the same time, logistics demand in second tier cities in Southeast Asia and India is rising on the back of growing populations and increasing urbanisation.

  2. Emphasis on Supply Chain Resilience

    While supply chain disruption is expected to ease in H2 2022, pandemic-related risk could persist for some time, ensuring demand related to occupiers’ just-in-case inventory strategies continues. This year will see occupiers focus on regionalising their supply chains and nearshoring their supplier base within the region, leading to further growth in demand for industrial and logistics space in emerging Southeast Asia and India, along with established mega industrial zones in North Asia.

  3. New Tech to Facilitate Advanced Building Features

    With occupiers increasing their investment in and adoption of smart warehouse technology to enhance operational efficiency and storage capacity, interest is growing in newer logistics facilities with modern features such as high ceilings to accommodate automated stacking systems, sufficient loading/unloading zones and back-up power equipment for warehouse tech and cold storage.

  4. Sharper focus on be Environmental, Social and Governance (ESG) Criteria

    CBRE’s 2021 Asia Pacific Logistics Occupier Survey found that 67% of occupiers believe that green or sustainability features will be more prominent in logistics facilities in future. Common practices include green certification and energy sourcing, while there will also be a stronger emphasis on social and governance on the operational side, such as on-site safety and wellness programmes.


Logistics Occupiers Retain Optimistic Outlook

2022 is expected to be another strong year for the Asia Pacific logistics real estate sector. Most respondents to CBRE’s 2021 Asia Pacific Logistics Occupier Survey anticipate a better operating environment, with 78% planning to further expand their logistics real estate portfolios over the next three years.

The solid regional economy and improving global trade will provide a strong foundation for the sector in 2022. Major regional markets are projecting strong trade growth, with Oxford Economics expecting most countries’ exports to grow by more than 4.0% y-o-y over the course of the year. After the Regional Comprehensive Economic Partnership (RCEP) takes effect in January 2022, further growth in space demand will be witnessed across Asia Pacific from trading-related occupiers.

Logistics space demand will continue to be driven by growth in e-commerce and omni-channel distribution. Large e-commerce platforms, Third-Party Logistics firms (3PLs) and traditional retailers continue to expand and improve their distribution networks, while cross-border e-commerce is another emerging source of demand. Robust growth in the grocery, food manufacturing and delivery sectors will continue to fuel competition for cold storage space.

Following two years of pandemic-related bottlenecks, occupiers will continue to review industrial real estate portfolios to enhance supply chain resilience. The coming year will see occupiers focus on securing warehouse space near end-consumption points to improve operational efficiency and mitigate disruption. At the same time, the regionalisation of supply chains will benefit alternative manufacturing hubs such as growing industrial areas in Vietnam, Indonesia, Philippines and India, along with established mega industrial zones in mainland China, Japan and Korea.

In addition to robust expansionary demand, CBRE anticipates a rise in flight to quality requirements as more occupiers seek modern logistics facilities to enhance operational efficiency and install automation and other logistics technology. Built-to-suit developments will gain more traction, while occupiers are also set to partner with developers and investors to construct new logistics assets.



Uneven Supply Pressure

New supply in major Asia Pacific markets is projected to reach 200 million sq. ft. in 2022, a 50% increase on 2021. While the addition of new stock will exert short-term pressure on occupancy, any negative impact will be limited due to current low availability and the unevenly distributed development pipeline.

New supply will be led by Greater Seoul and Greater Tokyo, which account for nearly half of new stock due to be delivered this year. This year’s development pipeline is mainly confined to selected submarkets such as Incheon in Greater Seoul, and Route 16 and Ken-o-do in Greater Tokyo. Huadu in Guangzhou, Qingpu in Shanghai and NH-8 in Delhi NCR’s Gurgaon will also account for a sizable volume of new stock. Amid an influx of high quality new supply, landlords in these submarkets are expected to focus on shoring up occupancy by offering more attractive terms. Owners of older stock may offer more incentives or reduce asking rents to retain tenants.

The rest of the region will remain tightly supplied, with new completions in Singapore and the Pacific expected to tail off after 2022. While islandwide logistics vacancy in Singapore remains high, prime logistics assets in the east and west of the country are at close to full occupancy, leading demand to spill over to general warehouses. Around 75% of Singapore’s 2023 pipeline has already been pre-committed.

The absence of new supply means occupiers, especially those with large space requirements, are advised to plan their portfolio expansion well ahead of time. Pre-committing to new, high-quality space in well-supplied submarkets is strongly recommended.


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Rental Growth Set to Continue

Asia Pacific logistics rents will remain in the upward cycle for a twelfth consecutive year in 2022. All major markets are expected to record rental growth, which will be led by Hong Kong SAR, Beijing and Singapore. Hong Kong SAR is projected to register growth of 7.5% y-o-y on the back of shrinking availability and the anticipation of trade growth when the border with mainland China eventually opens.

Growth in many markets will nevertheless moderate from 2021 on the back of the stronger supply pipeline, with Greater Seoul, Guangzhou and Vietnam (Southern Region) among the cities expected to see a slower pace of rental expansion. Landlords, especially those of older properties, will adopt a softer stance towards rental increments and offer more incentives to attract tenants.

The rental gap between prime and suburban logistics facilities will widen further this year. Prime assets located near major consumer markets or transportation hubs such as Daxing in Beijing, West and East areas of Singapore will see faster rental growth, supported by robust demand from occupiers catering to time-sensitive last mile delivery. In contrast, occupiers with lower rental affordability, such as firms seeking large distribution centres or storage units, will relocate to outer areas or satellite cities.


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From Strategy to Action


  • Seize opportunities to expand and/or relocate while negotiating better terms amid the large volume of new supply. Proactively engage landlords in advance to secure customised building features to suit their business needs.
  • Plan ahead to extend footprint in areas anticipated to see upside potential such as emerging secondary consumption clusters and future transportation hubs.
  • Invest in technology and sustainability innovation and upgrade portfolios to include more assets capable of incorporating these two features.


  • Secure large tenants as quickly as possible, especially in markets with large new supply such as Greater Tokyo and Greater Seoul. Customise property features to accommodate occupiers’ specifications is also recommended.
  • Consider emerging logistics hubs expected to attract future demand by building up land banks in areas near new infrastructure or adjacent to rapidly growing neighbourhoods.
  • Upgrade older logistics buildings in prime locations to cater to occupier demand for modern features and ESG.

Asia Pacific Real Estate Market Outlook 2022


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Manish Kashyap
Global President, Advisory & Transaction Services
Advisory & Transaction Services
+65 6326 1220
+65 6225 1987
Dr. Henry Chin
Global Head of Investor Thought Leadership
& Head of Research, APAC
+852 2820 8160
+852 2810 0830
Ada Choi
Ada Choi, CFA
Head of Occupier Research, APAC
& Head of Data Intelligence and Management, APAC
+852 2820 2871
+852 2810 0830
Liz Hung
Asia Pacific
+852 2820 6557
+852 2810 0830