Prime Benchmark

Housing Investment Consultancy
Prime Benchmark

July 2018

 

In local terms, prime office rental markets in most cities rose slightly over the first half of the year and many are now in an early up-cycle. The markets moved by between -1.4% (Jakarta) and 7.3% (Osaka). Because of tightening supply in Osaka with a vacancy rate below 3%, prime buildings in this market saw higher rental growth than the average. Hong Kong remains easily the most expensive prime office market in the region 86% ahead of its nearest rival, Tokyo (C5W).

The regional prime retail rental markets moved by between -8.8% (Taipei) and 10.6% (Hanoi). The surge in visitors from China (2.56 million) and South Korea (1.71 million) to Vietnam offered upside for the retail sector in Hanoi. Over the first half of 2018, international visitors to Vietnam reached 7.89 million, up 124% over the same period last year. In Hong Kong, returning mainland shoppers also gave mall landlords the confidence to start raising rents.

Luxury apartment rents remained generally stable over the first half, moving by between 0.5% and 6.7% in most cities, with the exception of Taipei (-1.7%) and Osaka (-1.1%) which recorded marginal declines. Rents in a majority of the region’s luxury apartment markets are rising at a mild pace and many are in a late up-cycle.

In the hotel sector, Shenzhen (13.3%) and Tokyo (11.8%) both recorded high growth rates over the period, followed by Ho Chi Minh City (11.6%). An increasing number of Shenzhen technology trade fairs and events are attracting large numbers of visitors which in turn has raised demand for hotel rooms.

 

Key contacts

Simon Smith

Simon Smith

Senior Director
Research & Consultancy

Savills Two Exchange Square

+852 2842 4573

 

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