Global real estate investment activity is regaining momentum, but investors are becoming increasingly selective in deploying capital, favouring assets with resilient fundamentals, clear demand drivers and sustainable long-term income prospects, according to Savills.
The property consultancy said global real estate investment volumes reached US$250 billion in the second quarter of 2026, up 13% year-on-year, while the pipeline of transactions moving towards completion suggests further improvement in the second half.
Savills expects total global investment activity to increase by around 16% for the full year 2026.
The recovery suggests the market is moving beyond the adjustment phase caused by higher interest rates and repricing, although Savills cautioned that the increase in transactions does not represent a broad return of risk appetite.
Global growth remains positive but has yet to strengthen sufficiently to generate consistent acceleration in leasing demand, while inflation, interest rates and geopolitical uncertainty continue to influence investment decisions.
Instead, the current recovery is being driven by investors with greater confidence in pricing and asset fundamentals, supported by large single-asset transactions, portfolio deals and mergers and acquisitions.
“The defining characteristic of the current cycle is not capital returning to every opportunity, but increasing selectivity, confidence in investment prospects and the ability to identify the underlying factors capable of driving long-term income growth,” Savills said.
APAC Investment Hits US$46 Billion
Asia-Pacific is among the regions showing a recovery in investment activity, with real estate transaction volumes reaching US$46 billion in 2Q26, an increase of 18% year-on-year.
Savills said Mainland China and Hong Kong accounted for much of the improvement, albeit from a low base, while Australia and Singapore also registered stronger activity supported by large transactions.
South Korea and Japan, however, recorded declines of 22% and 27%, respectively.
Cross-border investment is also becoming more prominent. International investors accounted for 35% of Asia-Pacific real estate acquisitions during the first half of 2026, up from 28% a year earlier.
Savills also highlighted a record level of partial-stake transactions, as investors increasingly use more flexible capital structures, including acquiring partners’ equity interests, disposing of minority stakes and restructuring capital within existing investment vehicles.
The trend indicates that the means by which capital accesses real estate are becoming more diverse alongside changes in the sectors attracting investment.
Logistics, Student Housing And Build-To-Rent Gain Ground
Investment is increasingly shifting towards property segments supported by structural demand rather than purely cyclical growth.
Savills said student accommodation is gaining momentum across Asia-Pacific as international student numbers rise and institutional investment models become larger.
In Australia, forward-funding structures for build-to-rent projects are becoming more common, with investors providing development capital before taking the completed properties into investment portfolios.
Industrial and logistics properties also continued their recovery, with investment volumes increasing 17% year-on-year in the second quarter, while first-half transaction volumes rose 28%.
Australia, Mainland China, Singapore and Taiwan were among the more active markets.
In Europe, residential and long-stay accommodation assets — including rental housing, student accommodation, care facilities and senior housing — accounted for 29% of total investment volumes in H1 2026, supported by constrained supply, rental growth and more stable income characteristics.
Vietnam FDI Surges 58%
Savills identified Vietnam as another market where capital deployment is becoming more diversified.
Total registered foreign direct investment in the country reached US$38.06 billion in the first seven months of 2026, an increase of 58% year-on-year.
Newly registered capital more than doubled, rising 109.7% to US$21.05 billion, even though the number of new projects increased by a comparatively modest 7.8%.
Average registered capital per new project rose to US$8.66 million, almost twice the level recorded during the corresponding period last year.
Savills said the disparity between growth in project numbers and the size of registered capital suggests that foreign investment is increasingly being driven by larger-scale commitments rather than simply a greater number of projects.
Foreign investors’ capital contributions and share acquisitions also rose 61.6% to US$6.58 billion during the period.
Meanwhile, Vietnam recorded 126 announced M&A transactions in the first half of 2026, down 20% by number, but the total announced or estimated value rose 14% to US$2.43 billion.
May and June alone accounted for 71% of total first-half transaction value.
Quality Of Opportunities Becoming More Important
Savills Hanoi director Matthew Powell said the next phase of capital allocation would increasingly depend on the quality and investability of opportunities rather than headline economic growth alone.
“As capital becomes more selective, investors are looking beyond growth prospects to opportunities supported by strong fundamentals, transparency and long-term value,” he said.
“Vietnam’s ability to convert growth into investable opportunities will be increasingly important in attracting capital.”
Savills said Vietnam’s growth in manufacturing, logistics, technology, services and infrastructure, combined with continued urbanisation, is broadening real estate demand across multiple asset classes.
At the same time, larger investment commitments, share acquisitions and M&A activity are providing more routes for foreign investors to enter the market.
The consultancy said future competitiveness would increasingly hinge on information transparency, legal clarity, project deliverability, asset quality and operating performance.
As global capital becomes more selective, Savills said markets capable of turning economic growth into transparent, scalable and investable assets are likely to attract a larger share of international real estate investment.
