Key 2026 sustainability forces transforming APAC real estate

As Asia Pacific’s commercial real estate sector enters 2026, the focus is shifting from sustainability promises to operational resilience and tangible results. Leadership is now measured by the ability to implement and deliver real-world outcomes, underpinned by regulatory mandates and rising stakeholder expectations. In a world marked by geopolitical tensions and competition for critical minerals, resource efficiency, circularity and local resilience form the foundation of long-term asset value.

Energy availability and price volatility now sit at the core of location and asset strategy. Markets dependent on imported fossil fuels face rising and volatile commercial electricity prices. With demand projected to rise 4.4% annually through 2034, reliable, affordable, and clean energy has become essential for operational continuity and attracting top occupiers. The surge in AI and data centres further intensifies pressure on regional power and water systems, prompting stricter regulatory measures andan emphasis on efficiency. Consequently, localised generation, energy storage, and energy-smart buildings are becoming vital solutions for mitigating cost and operational risk.

Figure 1: Annual average commercial electricity prices, local currency per kWh

Source: JLL Research, BMI (2026)

Sustainability is now fundamental to market dynamics, with investor and occupier priorities rapidly aligning. JLL Research’s analysis of 11 APAC markets finds that 78% of future demand from top office occupiers are tied to carbon reduction targets. Nine in ten investors now integrate sustainability in deal decisions, and assets with strong green credentials outperform the wider market.

Figure 2: Proportion of top office occupiers with carbon commitments

Source: JLL Research (2025)

CRE stakeholders are prioritising energy efficiency to control costs and meet sustainability goals. In APAC, 87% of occupiers consider energy cost savings a priority, while 44% of investors demand energy efficiency as a non-negotiable criteria. Smart energy systems are becoming fundamental in lease decisions for one in two APAC occupiers, with an increased focus on optimising technology effectiveness.

Retrofits are emerging as an essential strategy to address obsolescence risks. APAC retrofit rates must grow nearly fivefold to align with 2050 climate goals. Owners are pursuing retrofits not just for compliance, but also to boost productivity and well-being—a value recognised by 52% of CRE leaders.

Figure 3: Proportion of Grade A and premium office stock older than 10 years

Source: JLL Research (2025)

Mounting extreme weather losses and climate risks make adaptation urgent for CRE stakeholders. APAC accounted for half of global losses from tropical cyclones in 2025 and faces US$26.8 billion in annual damage from flooding. As intensifying climate hazards outpace current building codes and adaptation measures, only properties strategically built or upgraded for resilience will safeguard market value in this new climate reality.

The playbook for 2026 clearly shows that sustainability is a lever for value, resilience, and operational excellence. Leaders who respond strategically are positioned to thrive by embracing strategies that range from circular design and energy transition to smart retrofits.