Asia Region Optimistic About Office Market For Rent in 2022
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The office market for lease in the Asia-Pacific region has experienced many fluctuations in 2021, largely caused by the impact of the Covid-19 pandemic. Now is the right time to talk about this market in 2022.
Office Market for Rent in Asia
According to a report by real estate consultant C&W, Singapore, Japan, and South Korea are the three office markets that are predicted to have above-average growth rates in 2022.
C&W expects the Asia Pacific economy to regain its position as the world’s highest-growing economy, with full-year GDP expected to grow 4.5% and total investment volume in the region. next year is expected to be on par with the 2019 peak, at around $180 billion.
In addition, the report also notes that the vacancy rate in the Asia-Pacific office market will increase slightly in 2021, largely due to supply exceeding demand as well as the impact of the Covid-19 pandemic on the whole global market. This leads to pressure on developers to reduce rents.
Next year, additional office space for rent across the region is expected to reach 55 million square meters, 77% higher than in 2020. This reflects still strong demand for the office leasing segment as well as The whole region’s economy is on the rebound after two years of being affected by the epidemic.
“Although many companies can adopt teleworking, the office rental market in Asia-Pacific will be less affected by Europe and the US because office workers in this region often do not want to work from home,” said the representative of C&W Asia.
Singapore Office Market
Particularly for the Singapore market, investors are the ones with more advantages in the office rental market in the context of limited supply and the economy is gradually reopening. Wong Xian Yang, head of Singapore market research at C&W, said that Grade A office rents in Singapore’s central areas, which are already higher than the average in many other countries, are now more dynamic. force to increase prices. In 2022, office rents in Singapore are expected to increase by 4.6% compared to 2021
“Demand for office space is supported by a thriving financial and technology ecosystem in Singapore. The Omicron variant is still a risk, but the data showing the magnitude of the effect is not yet clear. Except for the worst-case scenario (Omicron or another variant found to be highly contagious, lethal, and immune to vaccines), the Singapore office market is expected to continue on its recovery path into 2022”, emphasized the head of commercial real estate of C&W Singapore.
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