Australia named top commercial real estate market in Asia Pacific

Standard Life Investments expects Sydney and Melbourne office space to be the top performers in Asia Pacific commercial real estate in 2017.

“The top performers should be Sydney and Melbourne offices, given a resilient Australian economy, while dominant prime regional shopping centers should also perform well,” says Anne Breen, head of SLI real estate research and strategy. “The Tokyo office market is peaking, and we expect healthy but lower returns in 2017 as the new supply line grows.”

Underperforming sectors are expected to include office properties in Perth, Australia; office and retail in Hong Kong; office and retail in Singapore; and some office markets in China .

SLI also believes 2017 is likely to be another subdued year for the U.K. real estate market, while the continental European real estate cycle is entering a mature phase, meaning the strongest market returns have passed.

Shifting U.S. policies, meanwhile, will affect commercial real