Market Outlook

The soaring vacancy rates, which are in line with the continued completion of more new office buildings, have changed the recent “tenant market” situation. However, the overall 2017 market performance has indicated a sign of recovery, albeit moderately, with escalating enquiries for office expansion particularly from tenants exploiting the currently low rents. In 2018, Indonesia will move ahead with a 5.3% GDP projection, which will provide an interesting investment spot for overseas fund to come in, particularly in e-commerce and co-working business at least for the next two to three years.

Despite the Chinese New Year holiday, net absorption in the overall market still amounted to 160,900 sq ft in February on the back of relocation and consolidation requirements. Among the more notable new lettings, Kering pre-leased two whole floors (37,300 sq ft) at One Taikoo Place in Quarry Bay as part of their consolidation out of offices in Casuseway Bay, while RGA Reinsurance relocated within Swire Properties' Island East portfolio, leasing 26,000 sq ft at Dorset House at accommodate expansion plans.

Click to find out more about the below:

• Labour market tightens further
• Grade A office vacancy rate continues to decline and stands at sub 3% for the fifth consecutive month
• Grade A rents continue moderate growth trend
• Tokyo Midtown Hibiya completes

Over the past 12 months, the addition of gross office space has been significantly constrained in the Melbourne CBD. This has led to a supply shortage, notably for larger occupiers, and driven pent-up demand from tenants who are coming to the market to satisfy their requirements