Long-term Lifestyle Priorities Remain Consistent
But Millennials Influencing New Paradigm in Asia Pacific Real Estate
Asia Pacific millennials share similar long-term lifestyle priorities with other generations, despite often superficial perceptions of this emerging superclass, according to CBRE research. CBRE’s inaugural report on this demographic, Asia Pacific Millennials: Shaping the Future of Real Estate, redefines the perceptions of millennials in the dynamic Asia Pacific region and how they approach lifestyle priorities through defined live, work and play ambitions.
The findings of the report demonstrate that perceptions of millennials as preferring informal employment, changing jobs regularly and avoiding financial responsibility are inaccurate in this region. According to CBRE research, consistent with previous generations, most millennials save money to buy a home and spend prudently. The report also illustrates that this demographic aspires to carve out a stable career but take into account factors such as office design when selecting an employer—with 71% of respondents willing to give up other benefits for a better office environment.
“The millennial demographic in Asia Pacific is a game-changer for businesses across the board. Their live, work and play priorities and habits will shape economics, redefine opinions on workplace design and functionality, and drive new attitudes towards consumption and experience for the foreseeable future,” said Mr. Steve Swerdlow, Chief Executive Officer, CBRE Asia Pacific.
“Millennials represent the fastest source of spending power regionally and serve as the most influential demographic framing future trends in real estate through their lifestyle behavior, requirements and priorities of living, working and play,” said Dr. Henry Chin, Head of Research, CBRE Asia Pacific.
LIVE: Lifestyle and Home
Almost two-thirds of the region’s millennials are still living with family due to both cultural practices and financial factors. In most major markets surveyed, the high cost of residential property across the region are providing challenges for Asia Pacific millennials to accumulate the necessary capital to buy their own home.
The survey found that Asia Pacific millennials do aspire to own their own home, with 65% of respondents planning to buy property in the future. However, 63% of respondents said that they are forced into renting as they are unable to buy, and until they have the financial means to live independently, millennials will continue renting. When they do intend to buy a property, the survey found that Asia Pacific millennials will not purchase a home until they can find one that meets their living standards in terms of quality, size and location.
“Developers and city administrators should take heed of these trends by constructing more affordable housing for rent and sale,” said Dr. Chin. “In response to the challenges for millennials to accumulate capital for down payments, there needs to be innovation in structuring mortgages for young first-time homebuyers.”
WORK: Talent and Workplace
Millennials comprise 25% of the total workforce population in Asia Pacific and serves as an evolving demographic influencing decision-makers in the business world and the future of the workplace in terms of design.
While salary and benefits are still the main draw when considering a job, millennials also factor in lifestyle elements such as office design, flexible working, location and commuting time. The survey findings underline the importance of a high quality office environment—more than 70% of respondents said they believe that employers should put more thought into their working environment. Millennials view their office and its immediate surroundings as a community where they can relax, socialize and engage in other activities.
Due to the advent of technology, millennials are also increasingly demanding the freedom to work anywhere, anytime—more than 60% of Asia Pacific millennials desire flexibility and mobility at work.
Job loyalty by millennials is also stronger than perceived; two-thirds of Asia Pacific millennials expect to work for the same company, or for a small number of companies, throughout their career. Findings reveal that inspiration, responsibility and career progression are prerequisites to attract and retain the talent of millennials. People-centric workplace strategies that embrace diversity, choice and community—major draw cards for Asia Pacific millennials in career choice —can keep talent happier, more engaged and more productive.
PLAY: Socializing and Shopping
Asia Pacific millennials are more likely to spend their time and money on leisure activities and experiences like travel, entertainment and dining than previous generations.
Millennials shop online—at an average of 4.7 days per month—but only physical bricks-and mortar venues, particularly shopping centers, provide them with the experiences and social elements they require. Millennials visit shopping centers for purposes other than buying products, such as to dine out, banking and visiting exhibitions, at an average of three days per month. However, slower economic growth and a desire to save money for purchasing a home may inhibit future spending on leisure activities, suggests CBRE research.
“In order to leverage on millennials’ spending habits, retailers are recommended to increase the experience-based element of their offering and focus on providing an environment for visitors to socialize and relax. In addition to increasing F&B, cinema and entertainment elements in their shopping malls, retail landlords should consider organizing more live events to attract millennials. However, they should also carefully manage their tenant mix to ensure they still cater to other generations,” added Dr. Chin.