Singaporean investment and development giant CapitaLand is actively expanding its presence in Australia, viewing the country as a key market for long-term growth and sustainable asset development. In 2025, the company reaffirmed its strategic intent to invest in residential, commercial, and logistics real estate, leveraging rising demand, a stable macroeconomic environment, and the attractiveness of Australian cities to global investors.
Strengthening CapitaLand’s Position in Australia
CapitaLand already maintains a significant footprint in Australia through its investment arm, CapitaLand Investment (CLI), which manages assets in major cities including Sydney, Melbourne, and Brisbane. In 2024, the company acquired several strategic properties—premium office buildings and industrial parks—valued at over €600 million. These assets provide stable income and growth potential in markets with limited supply.
In 2025, CapitaLand announced plans to invest an additional €1 billion in Australia over the next five years. The investment focus is on sustainable housing, next-generation ESG-compliant offices, and logistics facilities to support the booming e-commerce sector.
Why Australia?
Several factors make Australia a priority market for CapitaLand:
- Stable economy. Despite global challenges, Australia’s economy showed strong performance in 2024 with a 2.1% GDP growth, attracting foreign investors with its institutional stability.
- Population growth. Migration and natural increase are driving ongoing demand for housing in major cities like Melbourne and Sydney.
- Real estate shortage. Regulatory constraints, construction bottlenecks, and rising project costs have led to a shortage in supply, supporting price and rent growth.
- ESG alignment. Australia’s commitment to environmental standards aligns with CapitaLand’s sustainability strategy.
Focus on Sustainability and Digitalization
A core part of CapitaLand’s Australian strategy is to develop green and energy-efficient properties. The company is integrating solar energy systems, smart energy management, and water recycling technologies into its new developments.
In Sydney, CapitaLand launched a net-zero residential project comprising 400 apartments, built with low-carbon materials and solar panels integrated into the facades. The project was highly rated under the NABERS energy rating system and Green Star standards.
The company is also implementing digital building management platforms, including IoT systems for optimizing resource use and data analytics for predictive maintenance.
Residential Sector: Emphasis on Affordability
Affordability is a pressing issue in the Australian housing market. CapitaLand sees this as an opportunity for scalable investment. The company plans to develop mid-range housing, supported by government partnership schemes, in the suburbs of Melbourne and Brisbane. Prices are expected to start from €310,000 for one-bedroom apartments and €420,000 for two-bedroom units.
These initiatives are co-financed with local authorities and include developments for regulated rental housing, supporting wider housing accessibility.
Logistics Real Estate and E-Commerce Growth
With Australia’s e-commerce market growing by over 12% annually, CapitaLand is increasing its focus on industrial properties. In 2024, the company acquired a logistics hub in Melbourne’s western corridor spanning over 70,000 square meters, leased to major online retailers. Construction of new warehouses, adaptable for automation, is planned through 2025–2026.
CLI is also considering launching a dedicated logistics fund targeting the Australian market, with a capital target of €500 million, aimed at institutional investors.
Commercial Real Estate and Office Sector Restructuring
As hybrid work models become the norm, CapitaLand is reconfiguring its commercial assets to support flexible office layouts, advanced infrastructure, and ESG certification. In Sydney and Melbourne, ongoing refurbishments aim to meet evolving tenant demands, with smart lighting, ventilation, and contactless access systems.
CLI reports that refurbished buildings are achieving a 95% occupancy rate with average lease terms exceeding six years. Prime office rents in Sydney’s CBD currently average around €640 per square meter per year.
Partnerships with Local Stakeholders
To implement its strategy effectively, CapitaLand is working closely with local developers, architectural firms, and planning authorities. These collaborations ensure that projects align with Australian regulations and planning frameworks, while also enhancing CapitaLand’s reputation on the ground.
The company is also engaged in urban policy dialogues with city councils, advocating for integrated land use and sustainable infrastructure development.
Financial Outlook
CapitaLand Investment currently manages approximately €3.2 billion in Australian assets. Over the next five years, the goal is to grow this figure to €5 billion, with a focus on sustainable yields and long-term value creation.
According to CLI’s Chief Financial Officer, the expected investment returns in Australia are in the range of 8–9% annually, with further upside driven by inflationary trends and constrained supply.
Conclusion
The Australian real estate market offers a resilient foundation for CapitaLand’s long-term strategic ambitions. By combining residential, commercial, and industrial portfolios with a strong ESG and technology-driven approach, the company demonstrates a well-balanced growth plan rooted in deep local engagement.
With more than €1 billion in planned investments by 2030 and a robust network of partners, CapitaLand affirms its commitment to Australia as a key pillar of its global expansion. In a shifting urban landscape, CapitaLand is well-positioned to shape the future of sustainable real estate development across the continent.
