Some analysts are describing the sector in Japan as the last stronghold for property investors in the recession-hit economy.
Even with vacancies creeping up, rents for existing contracts will decline only slightly, and not until 2010, according to analysts CLSA.
Landlords reacted slowly to a climb in office values in the last four years and are still able to nudge rents up this year
On top of that Asian developers learnt the lessons of overbuilding in the 1997-98 crisis, and only Singapore has a large supply of new office blocks coming onto the market in the next few years.
'We have less of an issue of supply. It's all about demand and whether the growth will pick up later this year, after all the government stimulus take effect,' said Frankie Lee, fund manager with Henderson Global Investor in Singapore.
Analysts warn investors to steer clear of Hong Kong and Singapore office landlords as both cities will be hit hard by the global trade slowdown and upheaval in financial markets.
CLSA, which has office landlord Hongkong Land on its sell list, expects office rents to fall 60% over two years in Hong Kong and Singapore as job losses in the financial sector grow.
However emergency property sales are in store in Japan, Australia and India as banks refuse to roll over debt, forcing landlords to raise funds or go out of business.
Although banks in the Asia-Pacific region are not struck by the toxic assets that have paralysed their Western counterparts, they are cutting exposure to falling property markets.
Big firms with healthy reputations and balance sheets will likely get the benefit of the doubt, but their small rivals will suffer. And big discounts on distressed sales will drag down prices for land and commercial buildings across whole markets.
'I think 2009 is going to be the year of trusts going private and assets being sold,' said Jonathan Kriska, analyst at Paterson Securities.
Things are even tougher in Japan, where 16 listed property firms including Urban Corp failed last year because of trouble raising operating funds, despite having profitable businesses.
The Japanese government last month announced emergency measures to rescue cash-strapped property firms. But since then, Creed Corporation has filed for court protection from creditors and the economic outlook has grown even gloomier, raising the prospect of more victims of the credit crisis.
Banks that had funded deals to up to 90% of an asset's value now offer 60% and refuse to lend to some companies.
