Guangzhou’s Grade-A office rental market continued to warm up in the second half of 2020. However, the new demand citywide was at its lowest over the past ten years the due to Covid-19 pandemic. The average rent dropped to 166.4 yuan per square meter per month by the end of Q4, according to Savills, a global property agent.
5 Grade A office projects have been launched in Guangzhou throughout 2020, pushing up the vacancy rate to 8.7 percent by the end of the year. Although the rental market has been warming up with increasing enquiries and property inspection since the second half of the year, some enterprises tended to extend the decision-making process as they are still relatively cautious about office cost control.
Demand from the TMT industries has been robust and contributed to most of the annual growth as the local economy bounces back while the information technology industry is rapidly developing. The demand from the financial industry has been strong throughout the year and saw large leasing transactions every quarter.
Guangzhou is expected to see its new grade A office supplies peak in 2021. New projects will be located in Zhujiang New Town, Tianhe Bei and Pazhou. The average rent is anticipated to continue to decline due to new demand.
According to the Savills’ report, Guangzhou’s office market is expected to attract more domestic and oversea investors with the rapid development of the Guangdong-Hong Kong-Macao Greater Bay Area. The enquiries, project inspection and transaction activities should all continue in 2021.
Reported by Jasmine
Edited by Jerry