Ernst & Young’s Seng Leong Teh: Developers must acquire, build own proprietary data capabilities

He shares his insights on how Asia’s real estate players can maintain profitability whilst navigating intersecting industry pressures.

The Asia Pacific real estate market has moved into a more advanced phase of recalibration and innovation as 2026 unfolds. With high interest rates and fluctuating construction costs, the industry is increasingly prioritising stable income streams and operational efficiency as they create value through green retrofits, artificial intelligence-powered management systems, and alternative asset classes.

Navigating this structural shift requires a rare blend of global capital market fluency and deep regional insight, experiences which Ernst & Young Global Real Estate, Hospitality, and Construction M&A Leader Seng Leong Teh possesses. With more than 18 years of experience, he has advised major investors, developers, and funds on complex real estate transactions.

His work with major industry players and involvement in landmark deals reflect the depth of expertise he brings to evaluating excellence and innovation within Asia’s real estate and built environment.

As a judge for the Real Estate Asia Awards & Built Environment Awards 2026, Seong Leong looks into the strategic evolution of Asia's real estate sector, focusing on the intersection of market sentiment, urban liveability, global best practices, ESG compliance, and the disruptive impact of technology.

How would you characterise the current investment climate for real estate across Asia?

Recovery is real but uneven. APAC CRE (per CBRE) investment hit US$147b to US$157b in 2025, up 12-22% year-on-year. However, capital is concentrated in Japan, Sydney, and Singapore. No emerging market features in the top five cross-border capital destinations. As such, the RE investment climate is a K-shaped recovery and nuanced across markets.

Property cycles are divergent across markets. Japan is at record investment volumes in a rate-hiking cycle; India is at peak office leasing; China has 20-30%+ vacancy rates with a 300 million square metre supply pipeline. Treating Asia Pacific as a single market is analytically indefensible.

Higher-for-longer rates hit emerging markets hardest. Given the current war in Iran, the likelihood of higher inflation may result in higher for longer rates. Unlike developed APAC markets, EM economies face compounding pressures — elevated local inflation, currency volatility, and USD-denominated debt costs. Indonesia and the Philippines both face widening current account deficits, amplifying the cost of capital and squeezing leveraged development returns.

China remains the region's biggest challenge. Residential prices contracted 6.4% year-on-year in 2025 (per CBRE), with further declines forecast through 2026. Office vacancy exceeds 20%. The structural oversupply, weak corporate hiring, and geopolitical headwinds make meaningful recovery unlikely in 2026, though markets are trying to figure out the bottom.

Operational excellence instead of buying well is driving returns. The era of broad market-driven gains is over. Winners are those creating operational value — logistics in Southeast Asia and multifamily in Japan. In emerging markets, especially on-the-ground capability and income-led underwriting are prerequisites.​​​​​​​​

As cities densify, how should developers balance commercial returns with urban liveability?

My core hypothesis and opinion is that Asia got it right before the Western markets did, especially on Asia’s mixed-use model. It was not born out of urban planning idealism — it was born out of land scarcity, density necessity, and transit investment, and those constraints have accidentally produced a more resilient, higher-returning real estate product than the US standalone big-box model. McKinsey research shows that cities with dynamic mixed-use spaces saw fewer people fleeing to the suburbs, greater office attendance, and stronger in-store retail than cities where urban cores consist mainly of office buildings. Developers are retreating from single-use schemes in favour of high-density, mixed-use developments that encompass living, working, and retail space in single projects. Mixed-use provides a natural income hedge against cycles. The office-retail-residential trinity is also what creates genuine cycle resilience — the office component anchors daytime footfall, retail monetises it, and residential provides the evening and weekend economy. It helps to focus on the demographics that respond well to urban liveability. Case in point: Marina Bay Financial Center, One Bangkok, Fort Bonifacio in Manila, etc.

From your involvement in global real estate transactions, what insights do you think would prove most relevant to Asian property deals?

Operational excellence instead of buying well is driving returns. The era of broad market-driven gains is over. Winners are those creating operational value — logistics in Southeast Asia and multifamily in Japan. In emerging markets, especially, on-the-ground capability and income-led underwriting are prerequisites, not advantages.​​​​​​​​​​​​​​​ Asset-heavy developers are relooking at their cost structures to optimise their corporate structure and improve shared resources within their value chain.

With ESG reporting and disclosure standards tightening globally, how prepared are real estate industry players in Asia to meet these expectations?

My personal opinion is that there is a shift from broad ESG reporting toward net-zero as a P&L lever. However, there is a critical risk: the risk of greenwashing, where there are many claims but difficulty in demonstrating traceable metrics. Doing too little is also a problem because the broader RE industry has woken up to the relevance of ESG, albeit for narrower metrics. The good news (based on CBRE Chief Sustainability Officer Survey) is that over 80% of sampled landlords and investors in the Asia Pacific have established designated ESG roles, but around one-third of landlords and developers still require their ESG leads to perform other functions, and about half of these positions were established only in the past three years. The infrastructure for credible, auditable ESG reporting is not mature enough yet. For the listed companies, the preparedness gap is even more glaring at the regulatory level. There remain varied levels of progress in constructing a coherent ESG policy framework within the Asia Pacific, with a lack of clarity, inconsistent taxonomy, and gaps in commitment levels between territories, creating an uneven regulatory landscape. As such, the level of preparedness varies across markets and primarily in meeting listing requirements. My own advice would be not to ignore ESG but to identify the business-relevant metrics that drive shareholder value.

How should traditional developers evolve in the near future to be able to compete with technology-enabled real estate platforms?

Per Cushman and Wakefield, the global proptech market is at US$25b in 2025 and expected to grow to US$90b by 2033. A large majority of these are still in start-up phases. What is becoming interesting is that these proptechs are forcing innovation in laggard sectors to drive key value drivers of developers (namely underwriting) by focusing on data revolution through the systematic use of alternative data, analytics, and data science models across underwriting, site selection, investment, and operations — not just having more data, but integrating raw datasets into repeatable, decision-ready workflows that allow firms to move faster and with greater confidence. The actionable implication is that developers must acquire or build their own proprietary data capabilities (which currently rely on a few key stakeholders’ experience and knowledge) through neighbourhood scoring, foot traffic data, demographic layering, and automated valuation models — as a core competency, not a back-office function.

As a returning judge at the 2026 Real Estate Asia Awards and the Real Estate Asia Built Environment Awards, what qualities or innovations will you prioritise for this year?

Given the challenging market environment for the past five years, resilience and innovation would be the two key qualities that I look for. The market has moved into a cycle where income growth and cost optimisation are at the centre of real estate decision-making, and the ability to recalibrate and innovate will be the defining competitive judging point.