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Rental growth for top office space to remain stable
By Cao Qian |
January 10, 2012, Tuesday
|
Online Edition
Online Edition
SHANGHAI'S Grade A office market is expected to witness moderate rental growth in 2012, extending an uptrend despite increasing uncertainties in the global economy, major international real estate services providers said today.
Average rentals of Grade A office buildings across the city might climb between 5 percent and 12.5 percent year on year in 2012, according to latest forecasts released by Jones Lang LaSalle and Savills.
"Limited supply in the city's core central business district areas over the next 12 months will afford landlords bargaining power and the ability to maintain moderate rental growth during 2012, likely between 5 and 10 percent annually," noted Anthony Couse, managing director of Jones Lang LaSalle Shanghai.
"Self-use purchasers will continue to absorb much of the new supply in the pipeline in Pudong while supply will be limited in Puxi before the premium Grade A Jing'an Kerry Centre is finished in the third quarter."
Savills, meanwhile, seemed to hold a more positive outlook. Grade A office rentals could rise 12.5 percent in 2012 due to continuously strong demand from both domestic and overseas tenants, while new supply in the local market may total 650,000 square meters on both sides of the Huangpu River, according to the company's forecast.
Last year, Grade A rentals advanced 11 percent annually in Shanghai to an average 7.5 yuan (US$1.19) per square meter per day, Savills data showed.
Average rentals of Grade A office buildings across the city might climb between 5 percent and 12.5 percent year on year in 2012, according to latest forecasts released by Jones Lang LaSalle and Savills.
"Limited supply in the city's core central business district areas over the next 12 months will afford landlords bargaining power and the ability to maintain moderate rental growth during 2012, likely between 5 and 10 percent annually," noted Anthony Couse, managing director of Jones Lang LaSalle Shanghai.
"Self-use purchasers will continue to absorb much of the new supply in the pipeline in Pudong while supply will be limited in Puxi before the premium Grade A Jing'an Kerry Centre is finished in the third quarter."
Savills, meanwhile, seemed to hold a more positive outlook. Grade A office rentals could rise 12.5 percent in 2012 due to continuously strong demand from both domestic and overseas tenants, while new supply in the local market may total 650,000 square meters on both sides of the Huangpu River, according to the company's forecast.
Last year, Grade A rentals advanced 11 percent annually in Shanghai to an average 7.5 yuan (US$1.19) per square meter per day, Savills data showed.
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