Solid Labour Markets Underpin Demand For Asia Pacific Office Space
Asia Pacific – Demand for different property types is improving across the Asia Pacific (APAC), with robust labour markets supporting the increase in office space demand, reported Firstlinks on Wednesday evening (17 August, SGT)
For the office property segment, falling vacancy and limited office stock in the near term are supportive of a more solid office rental-growth outlook. Still, office tenants continue to focus on higher-quality and centrally located commercial properties, with prime office towers that have excellent sustainability ratings being the most coveted.
Aside from that, employment growth and office rental demand significantly recovered in the last 12 months, as countries across Asia Pacific continue to relax COVID-related curbs.
Notably, accessible and strategically-located office buildings in central business districts (CBDs) that come with many amenities are seeing robust tenant demand. This trend is reflected by the latest office net absorption figures in Singapore, Hong Kong, and Seoul.
Given that office stock remains tight in most economies in the region, office leasing fundamentals are becoming supportive of a more solid office rental growth outlook for CBD offices across Asia Pacific.
As a matter of fact, data on effective rents for Q1 2022 implies a yearly growth rate in the range of percent for the entire for several markets, including Seoul, Sydney, Hong Kong, and Singapore.
Furthermore, real estate experts are upbeat on the outperformance and premium commanded by green office properties. Energy- efficient office premises with certified green ratings are expected to witness stronger occupier demand and attain higher occupancy levels and greater rental uplift in the longer term.