In October this year, KWM attended Expo Real 2025 in Munich, Germany. The event brought together asset managers, investors, developers, financiers, consultants, and a broad spectrum of professionals from across real estate. The event featured a comprehensive conference programme with around 400 international speakers addressing the latest trends, innovations, and opportunities in the industry.
The conference sessions focused on investment in APAC highlighted a number of key themes relevant to investors in the region, namely:
Australia remains one of the preferred APAC destinations
Investor conversations consistently positioned Australia as the anchor market in APAC, underpinned by transparent regulation, strong immigration and structural housing undersupply. According to ANREV, Sydney and Melbourne are the “Top Two” APAC markets for foreign real estate investment. Logistics stood out as a bright spot, with assets delivering double‑digit annual returns and widespread integration of rooftop solar and battery systems to enhance tenant amenity and income resilience.
Rising demand for student accommodation and post‑university living
Demand for student accommodation and post‑university studio living continues to build in Australia, tracking European benchmarks in cities such as Amsterdam and Vienna. Operators and capital are converging around purpose‑built, amenities‑rich schemes, with rental growth supported by enrolment trends and deep occupancy pipelines.
Recalibrating the the office market
Structural shifts in the global office sector are moving beyond the long-discussed “flight to quality” toward a sharper divide between assets that can adapt and those that cannot. Capital and tenant preferences are converging around decarbonisation, amenity and adaptability.
- London is pivoting from incremental refurbishment to whole-building retrofit, with carbon scrutiny and urban amenity driving value. Life sciences and creative reuse projects are setting new benchmarks for resilient demand.
- New York’s Local Law 97 has made emissions compliance a key investment filter, prompting selective office-to-residential conversions through zoning reform and incentives.
- Singapore’s limited Grade A supply and pro-investment policy settings are accelerating mixed-use redevelopment in the CBD and Marina Bay.
Across these markets, the gap between future-fit and legacy assets is widening, as tenant experience, technology integration and sustainability credentials become central to value and leasing performance.
Hotels: franchise and asset‑light models under scrutiny
Discussions highlighted the competitive tension between global brands and white‑label operators as the hospitality sector intensifies its franchise/asset‑light orientation. Balancing the triangular relationship among investors, operators/franchisees and franchisors is critical.
From an investor lens, the proliferation of new brands raises questions about the durability of brand platforms, sustaining demand for long leases even as attitudes to franchise term evolve. Brand selectivity diverges by segment: budget/midscale brands display broader franchisee tolerance, while upper‑upscale/luxury remain more discerning. Some operators are prioritising higher upfront key money over strategic brand alignment.
Operationally, there is growing support for structured review events—for example, every five years within a 25‑year term—to introduce flexibility for renegotiation or intra‑group assignments when performance lags. Owners’ negotiation hotspots centre on key money, capex responsibilities, and the total cost of brand affiliation, with mixed views on the proposed review framework. Market momentum is strongest in extended‑stay/aparthotels and resort‑leisure, while full‑service hotels face comparatively lower occupancy in Europe.
Europe: sentiment improves, prudence persists
European sentiment has improved from 2024 but remains cautious. Financing conditions continue to temper deal activity, and alignment with evolving ESG regimes—including the EU Energy Performance of Buildings Directive—is increasingly a prerequisite for capital access and pricing.
What this means for APAC investors
Quality, sustainability and operational excellence are converging as value drivers across sectors. For Australia‑focused strategies, the opportunity set is deepest in logistics, living and high‑spec offices, with disciplined underwriting around retrofit costs, ESG compliance and tenant experience. Decision‑makers in Singapore are shaping the competitive landscape; governance, data and platform maturity are critical to access and scale.
Further information on investing in Australian real estate for global real estate investors is available in our KWM Investing Down Under Guide.
