Asia Pacific MarketView Q2 2018
01 Aug 2018
Investor Demand Remains Robust While Occupier Markets Surprise on the Upside
Solid leasing demand helped drive a 22% q-o-q increase in office net absorption to 16.8 million sq. ft. NFA in Q2 2018. Active markets included tier I cities in China, Hong Kong, India, Tokyo and Singapore. Rental growth picked up to 1.4% q-o-q or 4.7% y-o-y, the strongest quarterly gain since Q3 2011.
Retailer demand was solid in Q1 2018 amid the generally positive outlook for key markets including Hong Kong, Singapore and China. F&B remained the major demand driver, while other active sectors included luxury, fast fashion, lifestyle and entertainment.
Leasing demand was healthy in Q2 2018, driven by e-commerce and 3PL firms. Upbeat markets included Greater Tokyo and tier I cities in China. Rental growth continued to show strong momentum, rising by 0.8% q-o-q, led by outperforming Pacific markets.
Investment momentum remained strong, with transaction volume rising 28% q-o-q to US$33 billion, supported by the completion of several big ticket deals in Australia and Hong Kong. Property companies were the major buyers, accounting for more than 30% of total acquisitions, including three of the five largest deals.
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