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Global super-prime ($10m+) residential sales bounced back in Q1 2023, with 417 sales across the 12 markets tracked in Knight Frank’s Global Super-Prime Intelligence report, up 11% on the 376 recorded in Q4 2022 and the highest volume since Q2 last year.

This report was originally published in https://www.knightfrank.com.au/research/global-super-prime-intelligence-q1-2023-10221.aspx

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Rents in global luxury residential markets are continuing to see strong growth. The Knight Frank Prime Global Rental Index rose by 8.5% in the 12 months to March this year – with rents in a majority of markets hitting new records.

This report was originally published in https://www.knightfrank.com.au/research/prime-global-rental-index-q1-2023-10269.aspx

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• The Asia Pacific flex space market continues to display stable growth, with the total volume of flexible office space in the region reaching 87 million sq. ft. as of March 2023, an increase of 6% from September 2022.
   
• New flex space supply in Delhi NCR and Bangalore accelerated from 2022, with the two cities witnessing the addition of a combined 3.1 million sq. ft. of stock in Q1 2023. With leasing by flex space operators remaining robust in Q1 2023, the pace of new flex centre openings over the remainder of the year in these two markets is expected to be brisk. Weaker markets included Melbourne, where the potential insolvency of a local flex space operator resulted in a drop in flex office stock.
   
• Flex office penetration in the overall office market was steady at about 4% as of the end of March 2023. The proportion of flex space in Grade A office stock continued to increase, rising to 3.5% from 3.1% in September 2022, reflecting strong demand from flex space operators seeking to upgrade their centres to Grade A office buildings. 
   
• Ongoing economic uncertainty is strengthening the importance of portfolio flexibility and prompting a greater focus on cost management, driving occupier demand for flex space. CBRE’s 2023 Asia Pacific Occupier Survey found that more than half of respondents believe their portfolios to be under-allocated to flexible office space and intend to increase their use of it.
   
• Other key trends observed by CBRE in H1 2023 include tech firms’ continued dominance of usership of flex office space; CapEx concerns driving a preference for dedicated space such as enterprise solutions and strong demand for event space and access passes.

This report was originally published in https://www.cbre.com/insights/briefs/agile-real-estate-infographic-h1-2023-asia-pacific-flexible-office-market

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The office sector remains a key focus for Asia Pacific investors optimistic about the long-term fundamentals.

• Within APAC, Melbourne and Tokyo stand out on the path to value stability and recovery along with Copenhagen, Toronto and San Francisco at the global level. 

• While core offices remain a top pick for investors in APAC and EMEA, substantiated by current office investment volumes, there is a very different narrative in North America.

• Office occupancy levels in APAC are averaging 80%, and office density remains high. In Europe, occupancy is back to 65% and in North America, rates are at 50%.

• Seoul and Singapore recorded net absorption 30% above historical averages with both markets recording falling vacancy rates over 2022, contrary to most major markets globally. 

• Although limited sales transactions occurred over Q1 2023, we anticipate market sentiment will recover as an expected peak of the interest rate cycle comes to fruition over H2 2023 and equips investors and vendors with clarity and confidence regarding asset values and the cost of borrowing across the region.

 

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