The 2015 outlook for industrial real estate in Asia is very positive. The good news for the logistics sector is that the U.S. economy is showing further signs of recovery. Asia’s export-driven nations will therefore benefit from an increase in this key economic driver, meaning 2015 is likely to see a surge in demand for logistics space.

While the pace of economic growth is slowing in mainland China, the country’s economy is also becoming more consumption-focused, leading to increased demand for imports. That should support an increase in overall logistics through-put volume going forward. Logistics facilities remain in strong demand as e-commerce continues to bloom. Chinese shoppers are increasingly chosing to buy online not just because of convenience in accessing goods and services but also because a large segment of the younger population considers it a trendy style of living. As Chinese Premier Li Keqiang has publicly stated, e-commerce is likely to follow real estate as the next driving force behind economic growth. The government is set to encourage online consumption by supporting the development of online shopping, improving the speed of Internet access, and helping ensure reliable deliveries of online purchases to China’s huge population, including people living in rural areas.

By geography, the range of real estate opportunities Asia-wide will broaden in 2015. There are economic changes under way in Southeast Asian nations such as Malaysia, Indonesia and Vietnam that will foster demand for warehouse space. What’s more, an increase of new logistics facilities in second- and third-tier cities in mainland China is going to present more options to both warehouse operators and occupiers. Occupiers in particular can make the most of a good opportunity to relocate and consolidate their facilities, to enhance their operating efficiency. The volume of deal activity in the logistics sector will also rise in 2015, with a diverse range of activity including the sale of individual properties, mergers and acquisitions, equity investments and joint ventures.

Last but not least, industrial real estate for manufacturing in China will be on the radar screen again primarily because of the recent adjustment of the length of land-use rights from 50 years to 20 years. We anticipate that this change will encourage more end-users to acquire land for genuine manufacturing purposes in 2015, as speculators beat a gradual retreat.