Despite a strong supply pipeline, the office market will continue to perform in 2012, with vacancy rates remaining low.
While the recession hit all office markets hard from 2008 to 2010, the link is now breaking down, with different markets recovering at different rates.
Offshore investment is increasingly flowing into industrial markets. Rents are expected to rise more in 2012 as demand outpaces supply; the retail sector is still in the early stages of a slow recovery. The demand for institutional-grade properties remains strong, but rental growth will be limited due to weak retail spending.
For the most part, demand and supply are in equilibrium in Australia; there is no significant stock overhang, and this is likely to continue in 2012.
"While the outlook for 2012 remains bright, there is no denying that conditions have recently become more difficult, owing to slower global growth and continued financial market uncertainty." Some of these trends were visible in Q3, with leasing activity slowing in some markets, poor retail spending growth continuing, and fluctuating business and consumer sentiment. Manufacturing and finance are also especially vulnerable to a downturn in the economy.
"The financial sector is still under pressure, and bank lending remains a concern for some investors." "Macroeconomic problems will continue to wreak havoc on these markets in 2012," Dr. Rees predicted. real estate qatar
Asia Pacific Market Risks and Opportunities in 2012
Dr. Murray warned that financial centers in the region are still a source of concern for a recession in 2012.
"We expect a modest slowdown in rents and capital prices in both Hong Kong and Singapore in 2012, as both financial centers are more exposed to global trends." Rents have rebounded rapidly in the area since the downturn two years ago. Hong Kong and Singapore have advanced at such a rapid pace that they have already reached their height. At this point, we believe the world will escape a recession, in which case Asia Pacific will continue to outperform the rest of the world. While most markets in the area are expected to grow in rents and capital values, we expect the rate of growth to slow in some emerging markets, such as China and Indonesia, in 2012, while rents and capital values in advanced economies will continue to rise in Australia and should begin to rise in Japan. This is the polar opposite of what we've seen so far in 2011." Following a weak Q2 that was heavily impacted by the March earthquake, we saw a significant recovery in investment volumes in Japan in Q3. With nearly $5 billion in investment reported in Q3, Japan reclaimed the top spot in the area. Markets like Japan and Australia could benefit from venture capital seeking reasonably safe returns in 2012.
"All of the 2012 predictions will be heavily influenced by what happens in the global economy in the coming months. There is no question that the world is facing a more difficult climate as we enter 2012, but we remain positive about Asia Pacific's prospects at this time," Dr Murray said.