Is India's Commercial Real Estate Thriving Amid Global Trade Tensions?
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Synopsis
Discover the resilience of India's commercial real estate market as reported by Cushman & Wakefield. Despite global trade tensions, demand for office space remains strong across Asia-Pacific, indicating a potential for growth and recovery in the sector. This article delves into key insights and future outlooks for investors and occupiers.
Key Takeaways
- Strong demand for commercial real estate persists in Asia-Pacific.
- Robust growth in office space absorption is evident.
- U.S. dollar strength is driving capital inflows.
- Declining interest rates are expected to enhance investments.
- Manufacturers are adapting their supply chains amid trade tensions.
New Delhi, April 30 (NationPress) Demand from occupiers and investors for commercial real estate remains robust, with office space absorption continuing across major markets including India, Indonesia, and the Philippines, as highlighted in a report by Cushman & Wakefield concerning the Asia-Pacific region, published on Wednesday.
The first quarter of 2025 saw a remarkable 20 percent rise in net absorption of office space across Asia-Pacific (APAC), reaching 26 million square feet (msf) compared to 22 msf during the same period last year, the report indicates.
The strength of the U.S. dollar and attractive yields are fueling increased global capital inflows into APAC real estate, especially in stable sectors like logistics, data centers, and multifamily units.
Moreover, the declining interest rates are expected to further enhance investments in the commercial real estate sector, according to the report.
Although the evolving tariff landscape and possible trade wars pose risks, manufacturing sectors exporting to the U.S. are particularly vulnerable. Yet, ongoing supply chain diversifications are benefiting industrial hubs in Southeast Asia and India, despite the ongoing trade tensions.
Manufacturers will persist in assessing their supply chains and pursuing optimization opportunities, the report notes.
The report highlights that significant policy changes during the initial 100 days of U.S. President Donald Trump’s second term, particularly regarding U.S. trade, tariffs, and deregulation, have introduced considerable volatility into global markets.
However, despite the increasing global economic uncertainties, the economies and property markets of Asia Pacific are showing resilience, supported by domestic factors and robust market fundamentals.
Dominic Brown, Head of International Research at Cushman & Wakefield, stated, "Although risks are heightened, historical trends indicate that Asia Pacific's property markets are well-positioned for a swift rebound once greater global clarity is achieved. It is crucial for occupiers and investors to remain agile and adapt their strategies quickly to capitalize on recovery when it occurs."
While APAC commenced 2025 with strong momentum—driven by resilient domestic demand and ongoing real estate investments—the anticipated policy turbulence may temper growth as businesses adopt a more cautious approach to decision-making, the report concluded.
Point of View
It is essential to highlight that despite the uncertainties in global markets, India’s commercial real estate sector continues to attract attention. The resilience shown in the face of challenges is a testament to the strength of domestic demand and investment opportunities. Stakeholders must remain adaptable to navigate the evolving landscape effectively.
NationPress
17/06/2025
Frequently Asked Questions
What does the Cushman & Wakefield report say about office space absorption in Asia-Pacific?
The report indicates a 20% increase in net absorption of office space in Asia-Pacific, totaling 26 million square feet in Q1 2025, reflecting strong demand across key markets.
How are global economic factors affecting India’s real estate market?
Despite global trade tensions, factors such as U.S. dollar strength and declining interest rates are driving investments into India's commercial real estate sector.
What sectors are attracting capital inflows in APAC real estate?
Stable sectors like logistics, data centers, and multifamily units are attracting increased global capital inflows into APAC real estate.
What challenges does the manufacturing sector face in light of trade tensions?
Manufacturing sectors exporting to the U.S. are most at risk due to the evolving tariff situation, prompting companies to reassess and optimize their supply chains.
What does the future hold for Asia Pacific's property markets?
Despite current uncertainties, historical trends suggest that Asia Pacific's property markets are positioned for a rapid rebound once global clarity is restored.
