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Asia Pacific is continuing to witness aggressive expansion across primary and secondary data centre markets with 9.7GW operational, 3.3GW under construction and 8.5GW in planned stages across the region.
The usual primary markets, Beijing, Hong Kong, Mumbai, Seoul, Shanghai, Sydney and Tokyo, continue to experience growth despite headwinds originating from a lack of land parcels and power availability. As a result, ancillary locations are being evaluated as part of expansion strategies. The moratorium’s cap on Singapore’s IT capacity has led to unmet demand in the market, which has spilt over into nearshore markets such as Johor, which is seeing a huge pipeline under development and commitments to land banks. Similarly, Greater Jakarta’s large pipeline is driven by its central geographic location in South-East Asia and the country’s immense population growth has sustained its appeal to major investors and operators.
Global cloud service providers (CSP) continue to show a marked interest in secondary markets across the region. Hyperscale CSPs have planned presence in the secondary markets of Auckland, Bangkok, Busan, Kuala Lumpur, Osaka, Pune and Taipei. The tendency for colocation operators, developers and investors to follow CSPs into new frontiers with their own data centre deployments will see secondary markets attract new players and witness rapid growth over the next few years.
The Asia Pacific data centre region is experiencing varying speeds of development and so, for the first time, we have introduced our Asia Pacific Data Centre Markets Maturity Index, to track the evolution of a number of notable markets each quarter. This report will delve into 12 notable markets: Tokyo, Mumbai, Sydney, Singapore, Seoul, Johor, Jakarta, Hong Kong, Manila, Bangkok, Auckland, and Ho Chi Minh City.
Read the Report Read MoreGross leasing activity across the top seven cities of India was recorded at 12.7 mn sq ft in Q2 2023, building on the market traction sustained from the previous quarter and signalling the resilience in India’s office sector. In comparison to H1, gross leasing was also up by 2.5%, showing India’s office markets being clearly insulated from the global headwinds’ impact.
Net absorption is up 4% q-o-q but is typified by occupiers remaining slightly bearish on big expansion plans given the still swirling global headwinds of economic uncertainty. India’s net absorption across the top seven cities broke its declining trend to be at a three-quarter high. While occupiers do remain slightly bearish on expansion activity, India continues to see growth from its domestic firms and global occupiers spreading their wings, albeit at a slightly slower pace.
Space requirements have now stabilized and are showing signs of recovery with deal closures being rolled over and replaced by new requirements, keeping the demand pie intact. While the global headwinds and tech sluggishness would continue to be limiting factors, India’s resilience in the past six months is expected to sustain over the remainder of the year as well. Transaction closures will be relevant to the forecasts of 2023 with any slippages likely to keep 2023 slightly muted but positively impact the years beyond.
Key trends in office segment in Q2 2023
In recent years, the residential market has consistently embarked on a new chapter of growth, driven by buoyant consumer sentiment, robust property launches, competitive pricing, and a conducive interest rate regime. The strength of the residential market is evident from the robust sales volume recorded in the first half of 2023, with more than 62,000 units sold in each of the two quarters.
Notably, Q2 2023 saw sales of over 64,500 units, representing a 4% quarter-on-quarter growth. Interestingly, residential sales have consistently reached new peaks in each successive quarter over the past year. Aligning with this trend, Q2 2023 surpassed the previous historic high achieved in Q1 2023, making it the highest quarterly sales since 2008.
Key trends in residential market in Q1 2023 and H1 2023:
Institutional investors have continued to pose faith in the Indian real estate sector despite the global headwinds, including uncertainty over economic growth and geopolitical tensions. The rise in investment inflow is an indication of the growth opportunities as India continues to emerge as a bright spot among international markets.
The country’s property sector has attracted over USD 2.9 bn/USD 2,939 mn worth of investments across 22 deals during H1 2023. The average deal size of investments increased by 17% to USD134 mn compared to USD115 mn, an aggregate of 2022, according to JLL. The investment pattern continues to be robust and is expected to cross USD 5 bn in CY 2023, which has been the annual trend pre-covid and in 2022.
Key highlights of the report:
Cushman & Wakefield’s ESG Report covers our global impact during 2022, select highlights from 2023 and targets for the years to come as we work toward shaping a more sustainable, inclusive future for commercial real estate.
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