Against a backdrop of increasingly complex domestic and international conditions, the 2026 government work report outlines more flexible and adaptive targets for national economic development. These policy directions will have a profound influence on the real estate sector. The market's transition from focusing on incremental expansion to revitalizing and optimizing existing assets — combined with the accelerating integration of artificial intelligence across industries —will reshape market structures, redefine asset values, and reconfigure spatial development patterns in far-reaching ways.
Macroeconomic Stability Strengthens the Foundation for Commercial Real Estate Stabilization
China's core economic targets for 2026 are clearly defined, with GDP growth set between 4.5%–5%, balancing the dual objectives of stabilizing growth and adjusting structure. This forms a strong macro foundation for the stabilization and gradual recovery of the commercial real estate sector. Between 2024 and 2025, GDP growth remained steady at around 5.0%. For 2026, the fiscal deficit ratio is maintained at a relatively high 4.0%, with RMB4.4 trillion in local special‑purpose bonds. The quota for ultra‑long‑term special treasury bonds is further expanded to RMB1.3 trillion. Coordinated fiscal and monetary policies will continue to support leasing demand recovery and improved business sentiment in the commercial property market.
Accelerated Industry Transformation Sees Quality Enhancement of Existing Assets Become the Core Theme
The report emphasizes a three‑pronged approach of "city‑specific policies to control new supply, reduce inventory, and improve quality", while encouraging diverse channels to revitalize existing housing stock and advancing the construction of "good homes." This marks an accelerated shift from incremental expansion to quality enhancement of existing assets. In 2024, China's real estate value‑added as a proportion of GDP was just 6.3%, far below the 12.56% average of developed economies. This reflects a structural imbalance characterized by heavy investment in development and insufficient focus on services and leasing. The ongoing transition will make asset management, property services, and leasing operations increasingly central to asset valuation.
Consumption‑Driven Momentum Creates a New Growth Window for Retail Properties
Consumption‑boosting policies are injecting new vitality into the retail property market. The government work report allocates RMB250 billion of ultra‑long‑term special treasury bonds to support product upgrades and replacement, complemented by RMB100 billion in coordinated fiscal‑financial funds — creating a RMB350 billion consumption stimulus package. In 2025, China's total retail sales of consumer goods exceeded RMB50 trillion, with per‑capita GDP reaching USD13,953, signaling a critical inflection point where service‑oriented consumption accelerates. With services currently accounting for just 46.1% of consumption, there remains significant room for growth. Policies promoting "high‑quality service consumption" and "new consumption scenarios," combined with the promotion of staggered school holidays in spring and autumn, will create opportunities for high‑quality shopping centers focused on experiential and social retail formats.
AI‑Powered Intelligent Economy Drives an Upgrade in Office Market Demand
The rapid evolution of the intelligent economy is reshaping office market demand. The work report calls for expansion of "AI+," wider deployment of intelligent agents, and accelerated development of large‑scale computing clusters, indicating the transition of AI into commercialized and scaled applications. In 2025, China's core digital economy industries accounted for more than 10.5% of GDP, with the target set at 12.5% during the 15th Five‑Year Plan. AI‑related companies are expected to become key new leasing drivers in 2026. This will also stimulate a fresh investment cycle for data centers and industrial parks, with core computing hub cities — in the Beijing‑Tianjin‑Hebei region, Yangtze River Delta, and the Guangdong‑Hong Kong‑Macao Greater Bay Area — set to benefit first.
Capital Market Reforms Expand, Enabling a Full "Investment–Financing–Management–Exit" Cycle for Commercial Real Estate
Capital market reforms continue to support expansion in commercial real estate investment. The work report calls for deepened reform of comprehensive investment and financing mechanisms, expanded exit channels for private equity and venture capital, and accelerated growth of the public REITs market. By 2025, China's public REITs issuance exceeded RMB210 billion, making it the largest REITs market in Asia. In 2026, commercial public REITs enter their first year of development, with pilots extended to hotels and commercial offices. This establishes a "dual‑engine" landscape of "infrastructure + commercial real estate" and enables a more complete investment‑financing‑management‑exit cycle
Further Opening‑Up Boosts Cross‑Border Logistics and Foreign Investment Demand
China's opening‑up objectives in 2026 feature two core characteristics: expanding services sector openness to attract foreign investment, and promoting standardized, high‑quality development of cross‑border e‑commerce. In 2025, China's cross‑border e‑commerce imports and exports totaled RMB2.75 trillion, with growth outpacing overall trade for the fourth consecutive year. The sector's demand for high‑specification warehouses — characterized by high density and rapid turnover —continues to rise. Cushman & Wakefield data shows that the warehouse market is experiencing volume growth alongside price adjustment, with notable regional differences. As cross‑border e‑commerce becomes more regulated, and cold‑chain logistics demand continues to expand, green‑certified, intelligent high‑spec warehouses are expected to gain a competitive advantage.
Advancement of New Urbanization Brings Opportunities for Urban Clusters and Urban Renewal
A notable highlight among 2026 urbanization policies is the first‑ever proposal to build "innovation‑driven industrial communities and business communities." This concept breaks the traditional boundary between industrial parks and business districts, fostering integrated complexes that combine office, commercial, and residential functions. The report also supports the development of world‑class city clusters in the Beijing‑Tianjin‑Hebei region, the Yangtze River Delta, and the Greater Bay Area, while enhancing the dual‑city Chengdu‑Chongqing Economic Circle and accelerating growth in the middle‑Yangtze city cluster — further intensifying regional differentiation in the commercial property market. Urban renewal and revitalization of existing stock assets are core pillars of the current urbanization strategy. Policies promoting the reuse of existing land and idle buildings align closely with efforts to revitalize existing housing stock. For owners and operators of prime urban assets, regeneration projects offer strategic opportunities for repositioning and value enhancement.
Green Transformation Prompts Sustainability Certifications to Become a Key Competitive Advantage
The work report dedicates a standalone section to the green transition, announcing dual controls on total carbon emissions and intensity, as well as new policy tools such as zero‑carbon parks and a national low‑carbon transition fund. In 2025, China's national carbon market saw 235 million tons of allowances traded, with transaction value reaching RMB14.63 billion, up approximately 24% year‑on‑year. Carbon costs have become an increasingly important factor in corporate leasing and location decisions. With 97.9% of newly built urban buildings in 2024 meeting green standards, green retrofits of existing buildings are gaining momentum. Commercial properties certified under LEED, WELL, and China's Green Building Label standard enjoy notable advantages in rental premiums and tenant attraction.
Sabrina Wei, Chief Policy Analyst and Head of Research, North China, Cushman & Wakefield, said, "The 2026 government work report outlines a clear development vision for commercial real estate characterized by macroeconomic stability, targeted policies, and structural transformation. A GDP growth rate of 4.5%-5% will provide market stability, a RMB350 billion consumption stimulus will activate demand for retail properties, "AI+" will reshape the office market; capital market reforms and public REITs will enable a full "Investment–Financing–Management–Exit" cycle, urban renewal will unlock values of existing assets, and green certification will define new competitiveness for the industry. As the real estate industry transitions from a construction‑focused model to one centered on operations and services, institutions with strong capabilities in asset management and high‑quality operational service delivery will be best positioned to capture the emerging opportunities of this transformative new cycle."
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About Cushman & Wakefield
Cushman & Wakefield (NYSE: CWK) is a leading global commercial real estate services firm for occupiers and investors with approximately 53,000 employees in over 350 offices and nearly 60 countries. In Greater China, a network of 23 offices serves local markets across the region. In 2025, the firm reported revenue of $10.3 billion across its core services of Valuation, Consulting, Project & Development Services, Capital Markets, Project & Occupier Services, Industrial & Logistics, Retail, and others. Built around the belief that Better never settles, the firm receives numerous industry and business accolades for its award-winning culture. For additional information, visit www.cushmanwakefield.com.hk or follow us on LinkedIn (www.linkedin.com/company/cushman-&-wakefield-greater-china).
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