Grade A office rental statistics in Greater Bay Area released
INTERNATIONAL real estate adviser Savills has launched its indices on the prices and rentals of Grade A offices in the Guangdong-Hong Kong-Macao Greater Bay Area, which will be upgraded semi-annually.
Grade A office rentals in the area edged down 0.9 per cent over the second half of last year and went up by 2.4 per cent year-on-year in the first half of this year, pointing to an index of 172.
The prices of those offices declined by 0.4 per cent over the second half of last year and by 0.5 per cent year-on-year during the period, leading to an index of 216.
By the end of June, outstanding Grade A office space in the area came to 25.91 million square metres, with Hong Kong, Shenzhen and Guangzhou taking up about 31 per cent, 24 per cent and 20 per cent of the total.
Hong Kong has been leading the area in monthly rentals, which average 879.8 yuan ($124) per square metre and are 3.6 times the level in Shenzhen, the company’s report shows.
Relatively high vacancy rates are seen in Zhuhai and Foshan in South China’s Guangdong province, but with ever-improving infrastructure in the bay area, the two cities may prove favourable options to cost-saving companies and back office headquarters of large firms.
Compared with Hong Kong, the faster gross domestic product growth of Guangzhou and Shenzhen indicate the immense economic growth potential of the two cities. Accelerated urban regeneration of the two cities is expected to lift the quality and quantity of Grade A offices to empower long-term rental growth there.
The gap between Guangzhou and Shenzhen, and Hong Kong in the Grade A office market is projected to narrow with the integration in the bay area, the report said.