Chengdu’s Premium Office Vacancy Rate Drops to 16-Year Low Amid Business Rebound
Li Xiuzhong
DATE:  Jul 21 2021
/ SOURCE:  Yicai
Chengdu’s Premium Office Vacancy Rate Drops to 16-Year Low Amid Business Rebound Chengdu’s Premium Office Vacancy Rate Drops to 16-Year Low Amid Business Rebound

(Yicai Global) July 21 -- Chengdu's premium office vacancy rate fell to the lowest level in 16 years amid recovering business activity in the southwestern Chinese city, according to a property agency.

The vacancy rate of grade-A offices dropped to 18.4 percent in the first half from the earlier 20.3 percent logged in December, according to a report released by US real estate services firm CBRE yesterday. The latest number was the lowest seen since 2005.

Rebounding

Most economic indicators were up. For one, rents were rising after earlier declines. Rental income climbed 0.2 percent from half a year ago in the capital city of Sichuan province.

Supply was also increasing as more office buildings were finished in Chengdu. Five new projects, with a total of about 230,000 square meters of floor area, were completed between January and June. Net absorption, which measures demand, reached nearly 340,000 sqm, rising 63.9 percent from December, making the city the fourth-most popular one in this regard in China.

Chengdu-based companies were looking to upgrade their offices. Absorption of premium offices doubled to about 210,000 sqm, making up 60 percent of the total. This trend reflects the increasing interest and capabilities of high-quality companies to rent office space, said Lin Qinglan, head of CBRE’s local research department.

The technology, media, and telecom sector was booming based on the stats. In the first half, the TMT industry made up almost a third of all leasing demand in the city, and within the sector, online education and software development were particularly strong. Besides this sector, firms offering professional services accounted for nearly 13 percent of all demand, ranking No. 2, followed by construction, and trade.

Editor: Emmi Laine, Xiao Yi

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Keywords:   CBRE Group,Chengdu,Office,Vacancy Rate