The Beijing Grade A Office Market Vacancy Rate Hit a 20 Year Low
Eric Hirsch, Head of Markets, Jones Lang LaSalle Beijing
As the overall office market vacancy rate hits a 20 year low, rents are approaching unprecedented levels. In 1H11, total Grade A stock grew to approximately 5.8 million sqm, increasing by more than 400,000 sqm. However, supply has not been able to keep pace with demand. MNCs expanding operations were the key driver for demand along with domestic firms leasing multiple floors. The overall market vacancy decline 2.6% percentage points q-o-q and 4.1 percentage points year-to-date to 8.3%. Overall net effective rents grew 11.7% q-o-q and 17.3% year to date to RMB 243 per sqm per month, as all submarkets experienced growth in rents.