Beijing Office Property Market Research & Forecast Report 2Q13

In Beijing, several economic indicators highlighted a lack of demand and demonstrated the challenges to recovery during 2Q13. According to Beijing Statistics Bureau, the city’s Producer Price Index for Industrial Products (PPI) recorded a 13th consecutive month of decline in May 2013, decreasing by 3.1% y-o-y. Beijing’s Fixed Asset Investment (FAI) growth was 7.3% y-o-y during the period of January to May 2013, a deceleration of 2.9 percentage points from the same period of 2012. Consistent with the economic indicators, demand for Beijing’s office properties was slack in 2Q13, with a notably smaller amount of enquiries and leasing transactions compared to 2Q12. Given the tightened corporate leasing budgets and subdued confidence in the economy, some corporations retreated from Grade A office properties, leading the vacancy rate of the Grade A office property market to edge up. Correspondingly, the average net effective rent of the market declined moderately q-o-q in 2Q13. By contrast, the investment market was very active, with several en-bloc transactions concluding during this quarter.

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If you have any queries on the report or our research and consulting services, please do not hesitate to contact Mr. Carlby Xie, Head of Research, China, Colliers International through email, Carlby.Xie@colliers.com, or telephone, 0086 21 6141 3590.

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