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Office Rents Up in 13 Asia Pacific Markets in Q1 |
| Source: |
channelnewsasia.com |
| Source Date: |
Wednesday, May 02, 2012 |
| Focus: |
ICT for MDGs
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| Created: |
May 08, 2012 |
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Rents of grade A office space has increased in 13 markets in Asia Pacific during the first quarter of 2012, compared to the previous quarter.
This is the key finding of Jones Lang LaSalle in its just-released Q1 Asia Pacific Office Index Report.
The Index monitors grade A net effective rents in 27 key markets in Asia Pacific.
The report also highlights that rents of grade A office space remained static in three markets and declined in 11 markets.
Aggregate rental growth across the region in the first quarter of this year averaged just 0.2 per cent quarter-on-quarter, slowing further from 0.9 per cent in the previous quarter.
On a year-on-year basis, Beijing and Jakarta saw the strongest rental growth across the region (around 50 per cent).
The report also pointed out that net effective rents corrected by 5 to 6 per cent in Hong Kong and Singapore.
This as some landlords lowered asking rents in view of on-going contraction in the financial sector coupled with some tenants moving outside of the Central Business Districts (CBDs).
Dr Chua Yang Liang, head of Research (South East Asia) at Jones Lang LaSalle said: "On the back of a weak business and financial environment, the office market in Singapore continued to face downside pressure especially with the supply overhang, resulting in rising vacancy. We expect prime rents in Raffles Place to ease by 13-15 per cent for the full year."
The Index also reported that most major Asia Pacific markets saw increasing or stable capital values in the first quarter of 2012.
Across the region, the average quarterly increase in capital values was 0.8 per cent, slowing moderately from the 1.2 per cent recorded in the last quarter of 2011.
Capital values in Jakarta and Beijing recorded the largest quarter-on-quarter (4 to 8 per cent) increases (40 to 50 per cent year-on-year), largely in tandem with rental growth.
Dr Jane Murray, head of Asia Pacific Research at Jones Lang LaSalle added: "Capital values are expected to grow at a slower rate in most markets in 2012, due to more moderate rental growth as well as the continuation of tight credit conditions.
"Despite on-going rental adjustment, capital values should remain largely stable in Hong Kong and fall less than rentals in Singapore. Markets expected to see the strongest growth include Jakarta and Beijing, with increases of up to 30 per cent forecast for the full year."
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