Japan, Australia and Hong Kong lead distinct APAC living investment trends

APAC living investors shift focus to execution as new entry strategies emerge.

Investors in Asia Pacific's living sector are increasingly shifting their focus from where to invest to how to invest, according to Savills' APAC Living Sectors Q2 2026 report.

Savills said evolving market conditions and changing capital dynamics are creating new routes into the sector, with five key investment strategies now shaping activity: distressed and adaptive reuse conversions, ground-up development, platform mergers and acquisitions (M&A), and direct acquisitions.

According to Savills, investment approaches vary significantly across the region. Japan remains APAC's only mature institutional market for stabilised multifamily assets, supported by transparent pricing, steady transaction volumes and strong international participation. Around 35% of the largest multifamily transactions have involved overseas investors, while prime Tokyo multifamily yields remain at approximately 3.0% to 3.5%.

In Australia, build-to-rent development and office-to-residential conversions continue to attract interest, supported by strong rental growth despite elevated construction costs. Savills noted that one Brisbane office asset was acquired at about 60% below its 2017 cost basis due to its conversion potential, while the conversion of 41 George Street has delivered more than 1,180 purpose-built student accommodation beds.

Hong Kong is leading the region in hotel-to-living conversions, recording 13 hotel transactions worth HK$6.4 billion over the past year, with many older hospitality assets being repositioned into student accommodation and co-living projects.

Meanwhile, in Singapore, investors are increasingly gaining exposure to the living sector through platform acquisitions and adaptive reuse strategies. Savills cited recent transactions involving Habyt, The Assembly Place and Coliwoo as evidence of growing preference for platform-led expansion.

Despite ongoing dislocation in some hotel and office markets, Savills said long-term demand fundamentals for living assets remain strong across APAC, supported by demographic change and urbanisation.

"APAC living is not a single trade. Execution is now the differentiator," said Nicholas Wilson, Senior Director, Strategic Research & Advisor, Asia Pacific Capital Markets at Savills. "Investors are increasingly selecting entry strategies that best match each market's fundamentals, regulatory environment and operating landscape."