KRW 33.8 Trillion in Transactions Marks Record High in 2025… CBRE Korea Expects Structural Reconfiguration of the Commercial Real Estate Market in 2026

-Supply pipeline accelerates amid widening demand polarization, driving strategic shifts across office, retail, and logistics sectors
-240,000 sq m of new office supply; logistics vacancy rate stabilizes in the low-teens, intensifying asset-level differentiation

January 22, 2026 (Seoul) – CBRE Korea, the world’s largest commercial real estate services company, released its 2026 Korea Real Estate Market Outlook, forecasting that the domestic commercial real estate market will reach a pivotal inflection point this year as macroeconomic recovery and interest rate stabilization converge with supply-demand rebalancing and asset value repricing.

Driven by an expansion in large-scale office transactions, total commercial real estate investment volume reached approximately KRW 33.8 trillion in 2025, marking the highest level on record. While a partial adjustment is expected in 2026 due to base effects, the market is projected to remain resilient, supported by strategic investments for owner-occupier headquarters (SI) demand and sustained interest in alternative assets. In particular, data centers are expected to further strengthen their position as policy-driven strategic assets, backed by government policy financing and regional development initiatives.

By sector, the Seoul office market is expected to see a gradual recovery in tenant relocation and expansion demand from 2026 onward, alongside increasing visibility of new Grade A supply in core CBD locations over the mid- to long-term. Approximately 240,000 sqm of new office supply is scheduled for delivery in 2026, and when additional projects with completed project financing are included, total planned supply is expected to reach 1.49 million sq m by 2029.

Despite the expanding supply pipeline, vacancy rates are projected to remain stable at below 5% this year, underpinned by sustained demand for prime assets and a solid base of end users. According to CBRE’s Asia-Pacific occupier survey, approximately 70% of Seoul office occupiers maintain a five-day in-office work model, significantly higher than the Asia-Pacific average of 28%. Meanwhile, rising development costs continue to exert upward pressure on rents, with adjustments to rent-free incentives in certain submarkets reshaping negotiation dynamics between landlords and tenants.

The retail sector is showing signs of recovery in key commercial districts, supported by a rebound in inbound tourism and the expansion of medical and experience-oriented consumption, despite ongoing domestic demand softness. Traditional prime retail areas such as Myeongdong and Gangnam are seeing declining vacancy rates and rebounding rents, while emerging districts including Seongsu and Yongsan—after a period of rapid growth marked by rental increases well above the Seoul average—are entering a phase of more moderate adjustment. Retail spaces are increasingly evolving from pure sales venues into experience-driven, destination-oriented formats, with retail components within office arcades also gaining attention as a strategy to enhance the value of lower-floor spaces.

In the Greater Seoul logistics market, reduced new supply is easing concerns of oversupply, allowing supply-demand conditions to gradually rebalance. New logistics completions in 2026 are expected to total approximately 860,000 sq m, a significant decline from the large-scale supply seen in 2024. As a result, the average vacancy rate is forecast to stabilize in the low-teens, down from around 17% in 2025. Prime ambient logistics assets, in particular, are expected to see vacancy rates fall to single digits, reinforcing their scarcity and investor appeal. Regional differentiation is also becoming more pronounced, with western submarkets such as Incheon and Gimpo driven by e-commerce demand, while southern areas including Icheon and Yongin are supported by stable 3PL demand, widening rental gaps by location and asset quality.

Claire Choi, Senior Director, Head of Research at CBRE Korea, commented, “2026 will represent more than a simple adjustment phase—it will be a turning point where supply expansion, demand reconfiguration, and diversification of investment strategies unfold simultaneously. For occupiers, this translates into a broader range of viable space options, while for investors, a more disciplined, asset-selective approach focused on proven quality will become increasingly critical.”