In the first half of the year, the net absorption of Grade A office buildings in Beijing exceeded twice that of last year. Demand was concentrated on Internet companies

In the first half of the year, the net absorption of Grade A office buildings in Beijing exceeded twice that of last year. Demand was concentrated on Internet companies

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On June 28, 2021, the global tenant agency service company Cresa Shihua Jiarun analyzed the supply and demand trend of the Beijing office market in the first half of 2021, and the popularity of the business district. Overall, the net absorption of rental demand in the first half of the year exceeded that of last year. Twice, leasing demand is concentrated in Internet technology and financial leading companies; in addition, the current rents in various commercial districts are uneven.

In the first half of 2021, the overall supply of office buildings in Beijing accelerated. Six new projects were completed and entered the Beijing Grade A office market, bringing a total of nearly 470,000 square meters of high-quality leasable area, which is close to the total amount of last year and the city in 2020 The total new supply of Grade A projects is 510,000 square meters.

Looking forward to the second half of 2021, Mr. Wang Gang, President of Cresa Shihua Jiarun, analyzed that the Beijing office market may enter a short period of adjustment in the second half of 2021. Although the general trend of continuous demand recovery will not change, the growth trend in the first half of the year Or it will slow down.

Leasing demand is concentrated in Internet technology and financial leading companies

On the demand side, Ms. Li Fangyue, the managing director of Cresa Shihua Jiarun, said that benefiting from the effective prevention and control of the epidemic and the concentrated release of many leasing demand suppressed in 2020 in the first half of 2021, the net growth of the Beijing Grade A office market In the first half of the year, absorption amounted to approximately 414,000 square meters, which has more than doubled the full-year value of 2020. The city’s Grade B office market has a total net absorption of approximately 237,000 square meters, which is also a significant increase compared with the net absorption of less than 10,000 square meters in 2020.

In terms of demand sources, data from Cresa Shihua Jiarun shows that in the first half of 2021, the technology and financial industries will still be the main drivers of demand in the Beijing office market, and the two together contributed to the total area of ​​new leases and lease expansion in the Beijing office market. 70% of it. In addition, many market-leading large-area leasing transactions have been concluded, making the manufacturing industry surpass the professional service industry with about 11% of the market and rank among the top three sources of demand in the city.

Proportion of transaction area by industry (data source: Cresa Shihua Jiarun)

Various commercial districts show unevenness of cold and warm

As far as the transaction area is concerned, thanks to the transactions between the leading Internet and the tenants of manufacturing enterprises, the Shangdi/Beiqing Road commercial area has repeatedly seen large-scale transactions of more than 10,000 square meters in the first half of 2021. The leased area accounts for 29% of the city’s total transaction area, ranking first among all commercial districts. Numerous choices of high-quality leasing areas and continuously lowered rent levels have enabled leading Internet companies and large financial institutions to accelerate their deployment in the CBD business circle in the first half of 2021. The area of ​​new leases and lease expansion transactions in the CBD business districts was equally eye-catching in the first half of the year. It accounted for more than 23% of the city’s total transactions, ranking second among the city’s business districts. Wangjing/Jiuxianqiao commercial district and Lize commercial district, which is increasingly popular among tenants, accounted for the third and fourth place respectively.

Proportion of transaction area in each business district (data source: Cresa Shihua Jiarun)

In terms of rents, Mr. Xu Rongqing, vice president of Cresa Shihua Jiarun, pointed out that although the average rent reduction in the city’s Grade A and B office market continues, the continuous recovery in demand has narrowed the decline. The average rent in Beijing’s Grade A office market fell by 1.9% month-on-month for six months to RMB 354.0 per square meter per month. The average rent in the Grade B office market was RMB 210.7 per square meter per month, a half-year decline of 2.8% from the previous month.

Among the business districts in the city’s Grade A office market, the Liangmahe business district ranks first among the business districts with a half-year decrease in average rents of 2.2% due to rent loosening in some projects with high rents throughout the year. Many landlords in business districts such as Yaao and CBD have also continued to reduce project rents in order to speed up their sales. It is worth noting that, benefiting from the good leasing situation, the average rents of Lize, Wangjing/Jiuxianqiao and Zhongguancun commercial districts all realized a correction in the second quarter of this year. Beijing’s Grade A office market reappeared in commercial districts after 5 quarters. Rents have risen.

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