• F&B and fashion remain the primary drivers of retail leasing across the region, with personal care a notable—though more selective—contributor to demand.

• Rents still show divergent trends, with most markets experiencing flat to modest growth. However, Greater China remains an outlier, facing sustained rental pressure. 

• APAC retail investment market experiences substantial surge in Q4 2025, led by strong Australian unlisted fund and private company activity.

Asia Pacific retail leasing exhibited mixed results but stayed strong for experiential businesses and high-footfall areas. Food & beverage and fashion retailers led demand, supported by ongoing brand expansion. Retailers operating in Greater China maintained a selective approach amid soft conditions, while those in most other markets showed steady appetite for quality retail real estate. Tourism recovery provided a tailwind in key commercial hubs, though consumer caution continued to weigh on discretionary spending in some areas.

Landlords responded with differentiated strategies: in softer markets, they offered rental concessions and flexible lease terms to maintain occupancy; in resilient markets, active asset management helped sustain demand and optimize tenant mix. These efforts contributed to balanced supply and demand, with net absorption matching new completions in Q4—keeping regional vacancy steady at around 8.5%.

Rental performance reflected a clear regional split. The APAC Retail Rental Index declined for the fourth straight quarter, driven almost entirely by persistent weakness in Greater China. The strongest growth was recorded in India’s top-tier retail submarkets and along Tokyo’s key high streets, the latter benefiting from Japan’s record inbound tourism in Q4.

Investment activity rebounded sharply in Q4, with volumes reaching USD 7.2 billion—an 80% year-on-year increase. Australian unlisted property funds and private companies led the surge, accounting for the largest share of regional transactions. Japanese J-REITs re-engaged through strategic acquisitions, including Hulic’s purchase of the Kawasaki mall, while Singapore saw increased deal flow, highlighted by the sale of Clementi Mall.

Outlook

Leasing activity is poised to maintain momentum in early 2026, with food & beverage and fashion remaining the bedrock of demand—even as lifestyle and service-led concepts gain ground, and a new wave of direct-to-consumer brands embraces physical stores not just to transact, but to forge meaningful shopper connections.