JLL: Macau rents set to stabilize in 2026

Macau’s commercial and housing rents are poised to stabilize in 2026, even as commercial property prices continue to decline, according to JLL’s “Macau Property Market Review and 2026 Market Forecast.” Mark Wong, senior director of Value and Risk Advisory at JLL Macau, highlighted the uneven recovery in comments on the report.

The report, issued Wednesday, notes that capital values fell across property sectors in 2025 due to weak demand and macroeconomic uncertainty. Residential prices are expected to hold firm, while commercial segments remain under pressure from tight bank lending and the closure of all satellite casinos by year-end.

“Both gaming revenue and inbound visitor numbers recorded robust growth, reflecting the continued recovery of the tourism and gaming industries,” Wong said, adding that economic growth has returned to pre-pandemic levels but remains concentrated in specific sectors. He said the overall economy still faces structural challenges before achieving broader breakthroughs.

Tourism and gaming fueling recovery

In 2025, Macau’s economy showed resilience. Total gaming revenue reached MOP247.4 billion ($30.9 billion), up 9.1% from 2024, according to the Gaming Inspection and Coordination Bureau (DICJ). VIP segment revenue rose to MOP67.98 billion, a 24.1% increase, accounting for 27.5% of the total.

Gross domestic product grew 4.7% to MOP415.32 billion. Visitor arrivals surged 14.7% to 40.069 million, with mainland Chinese tourists rising 18.5% and accounting for 72.4% of the total.

JLL also noted that Individual Visit Scheme visitors increased 25.7%.

By year-end, hotel room inventory reached 45,165, up 4.9%, with occupancy at 89.4% and an average stay of 1.7 nights.

On employment, JLL said the labor market remained stable, with local unemployment at 1.9% and underemployment at 1.5%, according to the Statistics and Census Service (DSEC). Foreign workers totaled 183,679, a 0.6% increase. Median monthly income remained at MOP18,000, while resident deposits rose 7.6% to MOP819.58 billion.

“Because banks are tightening commercial property mortgage lending, investment sentiment in Macau’s commercial property market remains weak,” Wong said. He added that although some high-quality properties have been sold in major tourism areas, investors are now targeting yields roughly double previous levels.

Residential market

Residential transactions fell 9.2% to 2,775 in 2025, though pre-sales surged 44.8% to 333.

10 projects received pre-sale permits covering 484 units totaling 33,344 square meters, mostly in the mass-market segment on the Macau Peninsula. The 312-unit Lake Yoho project sold about 200 units.

Rental trends diverged, with high-end residential rents rising 1.1% but mass-market rents declining 10.3%, according to the JLL Macau Property Index. Capital values dropped 14.7% in the high-end segment and 16.5% in the mass segment, yielding rental returns of 2.3% and 2.5%, respectively. Slower foreign worker growth also weighed on rental demand.

Government measures introduced in November 2025 – including stamp duty exemptions on the first MOP6 million of property value and relaxed loan-to-value ratios – along with bank rate cuts are expected to stabilize the market in the short term, Wong said.

“The measures are expected to help alleviate mortgage burdens and stabilize the residential market in the short term.” He added that long-term challenges include limited demand growth and the absence of major population or infrastructure expansion plans.

JLL forecasts flat residential rents and capital values across both mass and high-end segments in 2026.

Office market in downward cycle

New business registrations grew 11.6% to 4,678 in 2025. Office rents fell 3.4% overall and 0.9% for Grade A offices, while vacancy rates reached 15.3% in the third quarter of 2025. Capital values declined 7.9% overall and 2% for Grade A properties, yielding returns of 3.2%.

Companies are prioritizing cost control, consolidating office space, and renewing leases early. Office rents are expected to stabilize in 2026, but capital values may decline by 0% to 5%, with Grade A properties remaining relatively flat.

Retail market faces pressure

Retail sales fell 5.4% to MOP50.56 billion in the first three quarters of 2025, affected by outbound travel and weaker consumer spending. Most retail categories declined, except for pharmacies and dried seafood products.

Prime street shop rents fell 0.9% and capital values dropped 8.9%, producing rental yields of 2.7%. Loan delinquency rates reached 5.4%, pushing distressed property sales yields above 4%. Tourist zones continued to attract investors due to higher returns, while neighborhood retail properties faced weaker demand.

JLL forecasts flat prime retail rents and capital value declines of 0%-5% in 2026.