Thought Leadership

• The government’s introduction of consumption coupons underpinned stronger retail sales growth in August, reversing the trend of slower m-o-m growth witnessed since the start of the year.
• Leasing sentiment improved over the quarter, with demand being driven by casual wear, sporting goods and F&B retailers.
• Central saw several major commitments by a range of retail trades and for a variety of lease durations and purposes.
• The expiry of several short-term leases ensured overall vacancy edged up in Q3 2021.
• Both high street shop and shopping centre rents were stable over the quarter.
• While rents are expected to rise steadily in the coming months, a sharp uptick is not expected until luxury and other premium retailers resume expansion along high streets.
• Stronger rental growth will materialise in 2022 should cross-border travel normalise by early next year.

This article was originally published in https://www.cbre.com/

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• Net absorption stood at -119,000 sq. ft. in Q3 2021, the eighth consecutive quarter of negative net absorption since the current market downcycle commenced in mid-2019. This downcycle is now the longest and deepest in the city’s history.
• However, the magnitude of negative net absorption continued to moderate from previous quarters thanks to an uptick in new leasing volume.
• Overall vacancy increased over the quarter, with pressure more prominent in Wan Chai/Causeway Bay and Hong Kong East. Vacancy fell in Kowloon East and was stable in Greater Central.
• While still limited, leasing demand was broad based and from a range of industry sectors. Most new leases involved relocation, with several downsizing moves also observed. Chinese firms remained relatively quiet.
• Stronger leasing momentum ensured the rental decline moderated in Q3 2021, with three of the city’s five major submarkets seeing rents fall by less than 1% q-o-q. Rents are expected to edge down further over the next 12 months.

This article was originally published in https://www.cbre.com/

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Overall net absorption bounced back to positive after eight consecutive negative quarters

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Robust investment activity across APAC markets setting the stage for a strong year-end performance.

Investor interest, buoyed by ample liquidity and easing of restrictions, supported robust activity in Asia Pacific property markets, setting the stage for a strong year-end performance.

Regional trends and report highlights for Asia Pacific:

• Australia and New Zealand saw renewed investor optimism and business confidence, particularly in the office markets, as key cities emerge from prolonged restrictions.
• Hong Kong registered a 20% QOQ growth in transaction volumes, as economic rebound helped boost investor appetite.
• Investment activity in China picked up, with more than 20 transactions totalling approx. RMB27.2 billion (USD4.2 billion) closed across asset classes in major Chinese markets.
• Singapore's retail sector led investment activity in Q3, with total transactions worth SGD7.5 billion (USD5.5 billion) registered.
• Korea's office market saw an active quarter, driven by soaring investment demand for office space in Seoul.
• The office, multifamily and logistics sectors in Japan continued to attract robust investor demand, amidst REITs prices recovering to pre-COVID-19 levels.

Download the report below to find out more expert recommendations for investors across Asia Pacific. Contact Terence Tang and John Marasco for more key trends and opportunities across Asia Pacific capital markets.

This article was originally published in https://www.colliers.com/en-in/

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