• F&B, wellness, and entertainment tenants are anchoring leasing activity — particularly in high-footfall urban hubs where landlords are prioritizing engagement.

• Performance remains distinctly local — anchored in market fundamentals. While Greater China continues to weigh on regional rent trends, most markets stayed flat or edged higher. 

• Q3 investment volumes slowed sharply, though YTD declines remain more moderate. Australia accounted for the largest regional share — supported by domestic investors returning to market.

Leasing demand across Asia Pacific held steady overall in Q3 2025 — though it moved at a varied pace, shaped by how local markets are faring. Food & beverage, wellness, and entertainment led the charge, driving the region’s most visible pockets of activity. Tourist flows lent support, especially in busy urban centers where international visitors still anchor foot traffic; Asian brands, meanwhile, continued their expansion into new territories beyond home markets. Even with cautious spending in some areas, retail’s direction is clear: immersive, experience-led spaces aligned with local preferences.

In response, landlords have been actively adjusting — tenant mixes, repositioning assets, and adding experiential elements to sustain occupancy. These efforts have helped underpin continued demand for space, feeding into positive net absorption. With new supply limited in Q3, absorption outpaced completions — pushing down regional vacancy to 8.6%. Most markets saw declines, signaling firming fundamentals despite uncertainty.

Rents eased slightly across the region, with the APAC Retail Rental Index marking its third straight quarterly dip — largely due to ongoing pressure in Greater China. Elsewhere, most markets saw flat or modest gains, underscoring uneven performance — yet resilience endures.

Investment volume came in at USD 4.4 billion for Q3, reflecting a subdued quarter (-47% y-o-y), though the year-to-date decline is milder at -15%. Australia remained out front, lifted by returning domestic capital — still the YTD leader. Selectivity hasn’t waned: investors remain focused on quality assets with durable fundamentals, or targeted opportunistic plays.

Outlook

Retailers are continuing to grow their brick-and-mortar presence — thoughtfully, with a clear preference for prime, high-traffic locations offering strong accessibility. Spending is expected to hold its course, though sensitive to macro conditions. The shift toward experience-driven retail continues; landlords and tenants alike are reshaping spaces to enhance dwell time and emotional engagement. Demand in top-tier locations should hold firm — led by F&B, lifestyle concepts, and interactive formats.