Beijing, Shanghai, Hong Kong and Guangzhou had the sharpest declines among 23 cities in the second quarter, consultancy Knight Frank says.
Hong Kong and mainland Chinese cities are likely to see more empty prime space and falling office rents in the next 12 months, contrasting with the fortunes of Australian cities, Taipei and Singapore, according to Knight Frank.
In a study of 23 cities across Asia-Pacific, the property consultancy found 15 markets recorded stable or increasing rents in the second quarter compared with a year earlier.
However, Beijing, Shanghai, Hong Kong and Guangzhou were the worst performers, registering rental declines of between 8.8 per cent and 11.1 per cent, the property consultancy’s data shows.
In terms of quarter-on-quarter change, Shanghai, Shenzhen, Guangzhou, Hong Kong and Beijing were also among the laggards, with rents decreasing by between 0.9 per cent and 3.6 per cent, the report said. Their vacancy rates ranged from 12 per cent in Guangzhou and Hong Kong to 25.8 per cent in Shenzhen.
“Prime office markets in the Chinese mainland’s first-tier cities endured another challenging quarter, with rents declining by 10.8 per cent year on year in the second quarter, steeper than the 10 per cent drop in the first quarter,” Knight Frank said.
This indicated “worsening market conditions in these areas”, it added.
