January 2021 Savills Asia Pacific Prime Benchmark

Prime retail markets were severely disrupted by the pandemic with rental movements from -41.6% (Jakarta) to +2.6% (Guangzhou). In Jakarta, with strict social distancing measures and restrictions on mall opening hours, landlords were pressured to provide rental relief, and many of them slashed rents by half. In China, retail footfall recovered, and rents increased by 2.6% and 0.5% in Guangzhou, Shanghai, while softening by 2.8% and 1.5% in Beijing and Shenzhen. Vietnam’s retail markets were resilient with total retail sales of goods and services up 5.6% QoQ in Q4/2020. Rents in Ho Chi Minh City and Hanoi increased by 2.1% and 0.1% respectively. 

The logistics market has proven to be highly resilient and will remain a key focus in the region, with rental movements ranging from -0.4% (Shanghai) to +7.3% (Singapore). The pandemic accelerated a shift to online retail, and logistics assets were the major beneficiary. In Singapore, most warehouses are at capacity and some spillover demand has been seen in traditional factory space. In China, driven by rising domestic consumption and e-commerce, demand for modern logistics facilities is expanding rapidly. Beijing (+0.7%), Shanghai (-0.4%), Shenzhen (+2.4%) and Guangzhou (+3.0%) all entered an early upswing.