Asia Pacific electric vehicle (EV) sales have seen exponential growth in the past two years, accounting for nearly two-thirds of global auto sales. The soaring demand for charging facilities across the region provides the opportunity for commercial real estate owners to enhance their assets with EV charging installations.
Asia Pacific electric vehicle (EV) sales have seen exponential growth in the past two years, accounting for nearly two-thirds of global auto sales. The soaring demand for charging facilities across the region provides the opportunity for commercial real estate owners to enhance their assets with EV charging installations, according to the latest CBRE research.
CBRE estimates that the number of public charging points across Asia Pacific region will rise to around 10 million by 2030, with nearly 70% of the new charging points to be in mainland China, the biggest market for EV sales. India and Singapore are the fastest growing EV sales markets in Asia Pacific.
Governments commit to phasing out Internal Combustion Engine (ICE) cars
The majority of Asia Pacific markets are looking to phase out the sale of new Internal Combustion Engine (ICE) cars within the next two decades. Singapore is the country with the most aggressive deadline for the ICE phase out, hoping to achieve this goal by 2030. Australia, Hong Kong, Korea, Japan and Thailand, follow closely with a self-imposed ICE phase out deadline of 2035. Indonesia, which in 2022 had over 17 million passenger cars according to data from the Statista website, is only committing to an ICE phase out by 2050.
Globally, EVs account account for only 2.1% of the global vehicle stock. Norway is leading the transition to electric vehicles with EVs achieving an 88% share of new car sales. In Asia Pacific, Hong Kong is leading the adoption of electric vehicles with EVs accounting for 53% of overall vehicle sales in 2022.
Commercial real estate owners need to enhance EV public charging infrastructure to keep up with increased EV demand
Globally, an average of 10 electric cars share one public charging point. As electric vehicle demand increases commercial real estate are starting to offer a wide range of options for EV public charging infrastructure, varying across retail, industrial, office, and on-the-road demand. EV chargers are becoming more common in shopping malls, as customers charge their vehicles while shopping. For industrial and logistics facilities, there is strong demand for direct current fast chargers as occupiers want more charging points for electrified fleets.
Business and science parks in decentralized locations or the suburbs are now showing stronger demand for charging points as more employees drive to work. Imminent regulatory requirements in Australia, India, Japan, and Singapore will hasten installation of charging points in new office buildings.
“From retail malls and office complexes to industrial warehouses, EV charging infrastructure is fast becoming the norm across Asia Pacific as landlords and occupiers gear up for the electric mobility era,” said Sidharth Dhawan, Regional Head of Alternatives – Automotive & Flex, Asia Pacific for CBRE.
While opportunities for EV charging infrastructure are growing, technological advances, like battery swapping, mobile charging, hydrogen fuel cars, and wireless charging, may erode demand for physical charging points. Apart from self-built charging points, other key business models to gain access to EV charging infrastructure include partnering with or investing in charging point operators.
“Planning for EV charging is a complex process. Property owners and investors need to consider potential challenges when installing EV chargers, such as the long payback periods, and short lifecycle of the charging systems,” said Dr. Henry Chin, Global Head of Investor Thought Leadership & Head of Research, Asia Pacific for CBRE. “We advise asset owners to engage professional consultants to help simplify the complexity and formulate strategies to expedite the installation of charging points in their portfolios.”
Asia Pacific requires several million more charging facilities
CBRE estimates the number of public charging points across the region will rise from around 2 million in 2022 to around 10 million in 2030. The bulk of the new charging points will be in mainland China, which will account for 70% of the total, with India expected to be the second highest market for charging point growth. CBRE expects the Pacific to display slower growth as private charging remains the norm.
Ed. Data courtesy of CBRE APAC report ““How will electric vehicles impact real estate in Asia Pacific.” Article photo by Roger Starnes Sr on Unsplash.