5 May 2017
Shanghai Office Market Report Q1 2017
GRADE-A OFFICE RENTS REMAINED STEADY DESPITE ABUNDANT NEW SUPPLY IN Q1
In the first quarter (Q1) of 2017, 720,000 sqm of new Grade-A offices were completed in Shanghai with an increase of 9% quarter on quarter (Q-o-Q) (See Table 1).
In Q1, the average Grade-A office rent remained stable at RMB9.8 per sqm per day, unchanged for three consecutive quarters (See Table 1).
A number of Grade-A office buildings were completed. New completions in secondary and emerging business districts were well received by the market.
The overall Grade-A office vacancy rate dropped 0.1 percentage point Q-o-Q to 4.2% (See Table 1).
Fast moving consumer goods (FMCG) and retail enterprises played an important role in Shanghai’s Grade-A office leasing market.
Many renowned FMCG and retail companies signed office leases with new buildings. PepsiCo and UGG leased 4,000 sqm and 2,000 sqm of office space respectively in Gopher Centre in the PostExpo area, Huangpu District. Yum China will relocate their office to T20 Building from Grand Gateway 66 in Xujiahui, leasing approximately 14,000 sqm of space.
In the second quarter (Q2) of 2017, another 700,000 sqm of new office space is set to be completed, of which 450,000 sqm will be located in Hongqiao CBD, where the total office stock will reach approximately 1.2 million sqm then.
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