• Greater economic stability as trade concerns ease. While growth remains subdued, major markets are expected to see continued economic expansion in 2025. The outlook for next year is more positive, supported by lower average interest rates and a more predictable global trading environment.

• Global real estate markets remain resilient through the third quarter. Pent-up industrial demand is building, with activity rising in several markets. Retailers continue to expand in core locations, while global office leasing in 2025 is at its highest level in six years.

• Investor sentiment is improving notably, resulting in a more competitive transactional market. Direct investment volumes growth continues to rebound and accelerated during the third quarter, signaling investors’ increased confidence in the market.

U.S. trade policy appears to have reached a state of temporary stability, at least with respect to most country tariffs. As tariff concerns have eased, fiscal sustainability risks have risen, driving up global bond yields. Most major markets are expected to see continued economic expansions this year and the outlook for 2026 is more positive, supported by lower average interest rates and a more predictable global trading environment.

Occupier activity was mixed across markets and property types during the quarter but remained resilient. Despite ongoing supply chain uncertainty, sentiment is improving in industrial markets as pent-up demand returns. Retailers continue to expand in core locations, while global office leasing over the first nine months of the year rose further to its highest level since 2019.

Global capital markets performed strongly in the third quarter as trade policy uncertainty reduced and major central banks continued to loosen monetary policy. Direct investment volumes rose further, with stable property fundamentals and highly liquid debt markets acting as catalysts for increased transaction activity. Fundraising marked a significant rebound after several challenging years, driven in part by strong performance in debt strategies and growing investor interest in secondary funds.

Direct investment activity reached US$213 billion in the third quarter of 2025, –an increase of 17% year-over-year. Year-to-date transaction volumes have now increased by 21% compared to 2024. The Americas posted particularly strong gains as transaction activity rose 26% in the third quarter led by the United States. EMEA investment volumes were 19% higher than last year in Q3, with the UK and Germany the two most liquid markets while Spain, Sweden and Belgium all posted robust growth. Trends were more nuanced in Asia Pacific where direct investment declined by 8% year-over-year. Activity in Japan remained strong despite the normalization of borrowing rates, with volumes rising by 16% year-over-year.

Cross-border investment has continued to recover in spite of geopolitical pressures, with third quarter growth of 7% year-over-year and year-to-date volumes 26% higher. The share of cross-border flows into each of the regions has remained relatively steady so far in 2025.

Logistics leasing activity improved in North America and Europe during Q3, although greater occupier caution was evident in some Asia Pacific markets. New supply has fallen significantly from peak levels and will continue to decline through 2026. Vacancy is already contracting in Asia Pacific, while availability is likely to peak and start declining in both North America and Europe over the next 12 months.

The living sector is on track for a strong 2025, with investment volumes on course to reach pre-Covid averages. The U.S. is leading the way with the third quarter notching the highest deal activity of the year. Volumes have also risen strongly in Europe and Asia Pacific , where strong demand for purpose-built student accommodation (PBSA) assets has been evident.

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