Singapore commercial property investment strengthens as regional capital rebounds: JLL

The pace of investment will remain sensitive to interest-rate movements, JLL said.

Singapore’s commercial real estate market ended 2025 on a strong footing, benefiting from a late-year rebound in regional investment activity and resilient domestic demand. 

According to JLL’s Asia Pacific Capital Tracker 2026 Outlook, Asia-Pacific investment volumes rose 15% YoY in the fourth quarter to US$40.3 billion, lifting full-year regional investment to US$147.6b, up 12% from 2024 and marking the strongest annual performance since 2021.

Within this backdrop, Singapore recorded a 28% YoY increase in fourth-quarter investment to US$4.2b, underscoring its position as one of the region’s more resilient and liquid markets.

JLL said activity was driven by living, office and retail transactions, with major deals led by real estate investment trusts, institutional investors and family offices. The firm noted that liquidity improved toward the end of the year, supported by capital recycling even as the pace of new core fundraising slowed.

The living sector emerged as a key growth driver for Singapore. JLL identified the city-state as one of the most active living markets in Asia-Pacific, alongside Japan, Australia and China.

Across the region, living assets captured a record 9 per cent share of total commercial real estate investment in 2025, reflecting rising investor appetite for rental housing, co-living and other income-focused residential formats.

Office assets also attracted renewed interest as market conditions tilted increasingly in favour of landlords. Declining vacancy levels supported rental growth and firmer pricing strategies, reinforcing Singapore’s appeal for investors seeking exposure to core, high-quality office assets amid limited new supply.

Retail investment gained traction as well, particularly in the suburban segment. JLL highlighted capital value growth supported by large transactions, as REITs and institutional investors recycled capital into defensive retail assets with stable cash flows, even as consumer and interest-rate dynamics remained in focus.

Cross-border capital trends further highlighted Singapore’s regional role. Whilst outbound institutional investment from China has moderated, private Chinese capital remained active in Singapore, and Singaporean capital was among the most active regionally, particularly in Australia.

JLL said these patterns point to the growing influence of intraregional capital flows across Asia-Pacific.

Looking ahead, JLL described the outlook for Singapore in 2026 as one of cautious optimism. Technology is expected to be a major catalyst, with the artificial intelligence boom translating into demand for data centres; across Asia-Pacific, data centre investment reached US$15b in 2025.

However, the pace of investment will remain sensitive to interest-rate movements, with investors closely watching global central bank policy—especially decisions by the US Federal Reserve—to assess borrowing costs and capital deployment in the year ahead.