Slower office rental growth, but still increasing: Knight Frank's Prime Office Rental Index

Slower office rental growth, but still increasing: Knight Frank's Prime Office Rental Index
Slower office rental growth, but still increasing: Knight Frank's Prime Office Rental Index

Knight Frank's Asia-Pacific Prime Office Rental Index for Q3 2018 has showed slower growth, however is still on the rise.

The Q3 Index increased saw an increase of 2.3% quarter-on-quarter and 6.4% year-on-year.

The index showed slower growth, as office occupiers delayed significant real estate decisions amidst rising US-China trade tensions

Slower office rental growth, but still increasing: Knight Frank's Prime Office Rental Index

Despite slower growth, 18 out of the 20 cities tracked report stable or increased rental growth.

Rental growth in Sydney and Melbourne continues to be among the strongest in the region, recording further increases during the quarter to be up 14% and 7% over the past year respectively  

Knight Frank's head of research and consulting Australia Ben Burston puts the increases down to employment growth and subdued development activity.

“Buoyant employment growth and subdued development activity continues to drive rental uplift in Sydney and Melbourne, which have recorded some of the strongest growth in the region over the past year," Burston said.

"The level of supply scheduled to deliver in 2019 simply will not redress the imbalance, and this will continue to drive rents and motivate tenants to pursue densification strategies or consider emerging fringe markets where expansion can be more easily achieved.”

Asia-Pacific Prime Office Rents

City

Submarket(s)

3-month % change (Q2 2018 - Q3 2018)

Forecast next 12 months

Brisbane

CBD

0.7%

Increase

Melbourne

CBD

2.6%

Increase

Perth

CBD

0.2%

Same

Sydney

CBD

2.5%

Increase

Tokyo*

Central 5 Wards

5.6%

Same

Beijing

Various

0.7%

Increase

Guangzhou

CBD

0.3%

Increase

Shanghai

Puxi, Pudong

0.0%

Decrease

Hong Kong

Central

2.7%

Increase

Taipei

Downtown

0.0%

Increase

Seoul

CBD, GBD, YBD

-0.7%

Same

Bengaluru

CBD

0.4%

Increase

Mumbai

BKC

3.9%

Increase

NCR

Connaught Place

0.0%

Same

Phnom Penh

City Centre

0.1%

Same

Jakarta

CBD

0.0%

Same

Kuala Lumpur

City Centre

-0.2%

Decrease

Singapore

Raffles Place, Marina Bay

1.1%

Increase

Bangkok

CBD

0.0%

Increase

Manila

Various

0.8%

Decrease

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Tags: 
Knight Frank Asia Pacific

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