According to the latest Beijing Prime Office Market Report released by Knight Frank, due to China’s economy slowdown, Beijing’s Grade-A office rents fell 2.2% quarter-on-quarter in Q2 2013, which was the first fall since Q3 2009.
Market overview:
There was no new Grade-A offices supply in Q2 2013. The market vacancy rate dropped 0.7 percentage point to 4.2%. The average rent of Grade-A offices in Beijing fell 2.2% to RMB387 per sq m per month in Q2 2013 due to macro-economic slowdown. In particular, rents in the CBD and Financial Street areas dropped 2.3% and 2% quarter-on-quarter respectively.
Market outlook:
Jingjing Zhang, Senior Manager of Research & Consultancy at Knight Frank Beijing expects in the coming six months, uncertainties in the global economy will continue. China is facing a tough challenge in the economic structure adjustment process. It is expected that the growth pace of Beijing economy will remain in the coming six months. Due to limited supply in the Beijing Grade-A office market, it is expected that the vacancy rate will remain below 5% and the average rent will fluctuate slightly in the future.