Shenzhen continued to see the strongest rental growth, both in quarter-on-quarter and year-on-year terms, the South China Morning Post reported, quoting the latest SCMP-DTZ mainland office rental index.
According to the quarterly index, which tracked 16 major Chinese cities, rents in Shenzhen increased 3.9 percent in the second quarter from the previous three months, or 18 percent on a year earlier.
“The financial sector has clearly emerged as the major demand driver in Shenzhen. This is especially the case in the Futian central business district, where occupiers have turned very optimistic on the back of the new financial policies being launched in the Qianhai economic zone,” said Andrew Ness, the head of research for China with DTZ.
“Interestingly enough, the optimism and heightened level of market activity by finance-sector occupiers have driven the media and telecommunications industries out of Futian and into Nanshan.”
Across the 16 cities surveyed, half witnessed a softening trend in office rents over the past quarter, the index showed. Of the remaining half that recorded growth, the average increase was less than 1 percent.
“Looking ahead, all of the cities tracked are expected to have new launches entering the market in the coming quarter. This will undoubtedly act to keep pressure high on availability ratios and rents,” said Ness.
“As a great portion of this future supply is concentrated in emerging submarkets, pressure and competition for occupiers in these areas will ratchet up to even higher levels.”
From a developer’s perspective, adjusting construction progress to avoid mistiming completion at a moment of peak competition had become a key consideration in many markets, he said.