Thought Leadership

OFFICE RENTS BOTTOM OUT IN Q3 2021

Rents and occupancy

• Prime Grade office rents in the Raffles Place / Marina Bay precinct grew for the first time since Q4 2019, with rents rising by 0.2% quarter-on-quarter (q-o-q) to S$9.98 per square foot per month (psf pm). Office rents turned a corner and bottomed out in Q3 2021 as occupancy rates for prime offices in the precinct remained relatively stable, falling marginally by 0.7 percentage points (pp) q-o-q to 93.6%, a slight reversal from the 0.1 pp growth recorded in Q2 2021.
• In tandem with the firm signs of improvement in the office rental market, the volume of pre-termination space available fell 78.9% q-o-q in Q3 2021, declining empathically from the 360,000-sf estimate in Q2 2021 to some 76,000 sf in Q3 2021. The decrease in shadow space was expected as the flight-to-quality continued with corporates taking advantage of the rare opportunity to snap up premium spaces in prime buildings that were normally fully occupied, before rents start to increase significantly.

This article was originally published in https://www.knightfrank.com/

The Asia Pacific logistics sector has performed resiliently since the onset of the COVID-19 pandemic on the back of accelerating e-commerce penetration, the development of omnichannel retail and the evolution of supply chain strategies for sourcing and inventory locations.

With logistics growth momentum showing no signs of slowing, CBRE recently conducted its first ever Asia Pacific Logistics Occupier Survey to identify the trends set to impact the sector in the coming years and help formulate strategies for occupiers and investors pursuing long-term sustainable growth.

The report identifies occupier optimism towards prospects for business growth; outlines the appropriate strategies for occupiers seeking to optimise their portfolios and operations; and profiles the next generation of logistics facilities. It also analyses the implications and opportunities for occupiers and investors seeking to increase their exposure to Asia Pacific logistics real estate.

This article was originally published in https://www.cbre.com/

Despite rapid growth in inbound demand in recent years driven by a sharp increase in overseas visitors, Japan’s retail and hotel markets remain overwhelmingly driven by domestic demand.

Therefore, while a recovery in inbound tourism is still some time away, Japan can be said to have rapid recovery potential, should domestic demand return.

CBRE believes the return of domestic demand is imminent, with pent-up demand steadily accumulating due to restrained consumption and various benefits and incentives provided by the government. 

This demand is likely to materialise in the form of consumption for higher-end goods and services, trends that auger well for Japan’s retail and hotel sectors, especially the higher-end segments.

This article was originally published in https://www.cbre.com/

H 1 2021 transaction volumes were close to the six monthly average observed over the past five years

Office and industrial sales lead the New Zealand market The top three largest sales above 100 million were office assets

Vacant land/development sites show a lift in sales volumes

Singapore based investors were the most active of the offshore groups, with a smaller proportion of investment by Malaysian and Australian buyers

Investment activity is dominated by private buyers 52 followed by institutions 34 and syndicates 7 However, privates are net sellers, while institutions and syndicates are net buyers

This article was originally published in https://www.cbre.com/