1、Insert title hereBreaking the Cycle:Back to BasicsChina Property Outlook 2026JANUARY 2026EXECUTIVE SUMMARY2Breaking the CycleChinas real estate market enters 2026 in a state of deep reassessment.Four years of subdued leasing,soft sales absorption,weaker footfall,rising vacancies,cautious capital,and

2、 persistent debt strain have pushed every asset class into a defensive posture.The old modelrelying on scale,momentum,and rising pricesno longer offers a path forward.What the sector faces today is not simply cyclical weakness,but a structural shift in expectations,business models,and economic purpo

3、se.The only sustainable response is to break the cycle of decline:the cycle in which cost-cutting erodes service quality,eroded service quality weakens demand,and weaker demand triggers yet more cost-cutting.This downward spiral has reached its limit.Breaking the cycle requires going back to basics:

4、an unflinching look at what each asset class is fundamentally meant to do,and how well it currently does it.Offices must re-establish themselves as places that genuinely enhance productivity,collaboration,and tenant partnershipinstead of merely offering space.Retail must rediscover community,identit

5、y,relevance,and emotional connection,not chase temporary traffic spikes.Logistics must align with the priorities of a modernised,automated,export-resilient industrial economy.Residential must focus on liveability,design quality,operational consistency,and trust.And capital markets must move from a d

6、ebt-dominated model to one supported by transparent valuations,patient equity,and long-term institutional capital.This is not just about stabilising the sector;it is about redefining its purpose.Yet while the short term still demands discipline and realism,Chinas long-term opportunity remains intact