Global Real Estate Perspective 2023

The final quarter of 2022 saw several economic challenges such as inflation, rising interest rates and slower growth. However, there are signs that the situation will improve, and the slowdown will be brief. This uncertainty is causing occupiers to be more cautious, leading to slower decision-making and defensive strategies. Investors are also finding it challenging to value assets in the current climate. In Q4 2022, demand for office space moderated in all three regions, and leasing volumes were down by 19%. Net absorption was negative during this period for the first time in 2022. The demand for logistics space remains high but has slowed down. However, the labor market and household balance sheets are strong, and this is positively impacting retail spending and travel demand. With Asia Pacific's confidence on the rise, inflation likely to have peaked and interest rate increases slowing, 2023 will be challenging, but conditions should improve as the year progresses.