New Delhi, Oct 29 (NationPress) The investment volumes in commercial real estate across the Asia-Pacific region soared to $63.8 billion during the third quarter of 2025, achieving the highest figure on record and showcasing a remarkable 56.8 percent increase compared to the same period last year, as reported on Wednesday.

This surge in activity nearly doubled the volumes reported in Q2.

According to Knight Frank's 'Q3 2025 Capital Markets Insights', this growth was fueled by several significant entity-level transactions and the finalization of deals that had previously experienced delays due to extensive due diligence processes.

Transaction volumes year-to-date have already achieved 80 percent of the full-year total for 2024, with expectations for Asia-Pacific investment to exceed $195 billion in 2025, reflecting a 10 percent year-on-year (YoY) increase.

“The record transaction volume of $63.8 billion in Q3 2025 signifies a genuine recovery in the Asia-Pacific market, propelled by clearer policies and the stabilization of capital rates,” stated Christine Li, Head of Research, Asia-Pacific at Knight Frank.

Investors are now pivoting from cap rate compression strategies to focusing on external factors like active asset management and income growth.

This renewed confidence is channeling significant capital toward strategic and defensive sectors, including the living sector and logistics, Li added.

The report also indicated that cross-border investments in the region amounted to $17.8 billion during the quarter, signifying a 72.1 percent increase from Q2 and a 28.6 percent year-on-year growth.

Australia attracted the most cross-border capital at $5.0 billion, mainly directed towards the living and industrial sectors.

Following closely was Japan, with $3.5 billion, primarily in office and multi-family assets, while South Korea attracted $2.3 billion, focusing on industrial and office properties.

“Cross-border investors are increasingly optimistic about the fundamentals driving key Asia-Pacific markets. Limited future supply, especially for institutional-grade office and logistics assets, combined with stabilizing prices, presents attractive investment opportunities,” noted Dan Dixon, Head of Capital Markets, Asia-Pacific at Knight Frank.

South Korea led the region with $14.3 billion in transactions, reflecting a remarkable 93.6 percent year-on-year growth and recording the highest growth rate among Asia-Pacific markets.

Office assets constituted 70.9 percent of South Korea’s total volume, as sellers opted to divest ahead of a potential oversupply in central business districts, while rental growth expectations remain positive.