The Asia Pacific logistics sector is at a crossroads amid geopolitical uncertainties and evolving market dynamics, according to Knight Frank in its Asia-Pacific H2 2024 Logistics Highlights report, released in February.

While 14 of 17 tracked cities recorded stable or increasing rents year-on-year in the second half of 2024, the report unveils a stark contrast in regional performance. Overall rent growth for logistics spaces in Asia Pacific slowed to 0.2 percent in 2024, down sharply from 7 percent in 2023 and 2 percent in the first half of 2024.

This deceleration, however, masks significant market variations across the region. Markets in the China face headwinds, with Beijing and Shanghai experiencing 14 percent to 15 percent rent plunges due to a substantial development pipeline, which is expected to reach more than 4 million square metres. The considerable development pipeline will lift vacancy rates in both cities to nearly 30 percent in 2025, exerting con