When it comes to office rentals in the Asia-Pacific region, Bangkok remained the strongest performer in the 1st quarter, according to research from Knight Frank. Due to improved economic sentiment in Thailand, the office market to reached even greater heights to start the year.
In the 1st quarter of 2017, Bangkok office rentals had the highest growth rates in the Asia Pacific region, rising 3.1 per cent from the previous quarter and 9.6 per cent when compared to the 1st quarter of 2016, shows data from Knight Frank’s Asia-Pacific Prime Office Rental Index.
Office rents in Bangkok have been increasing for over 2 years and this is a trend that is predicted to continue. That is because of the strong absorption amid limited supply available on the market.
“Despite a generally unremarkable macroeconomic climate, strong growth in Thailand’s service sector is leading to what seems like unceasing demand for office space, pushing rents ever higher. Looking ahead, a supply-side lag and a growing service sector mean that this climate of rising rents is likely to continue for some time to come” says Marcus Burtenshaw, Knight Frank Thailand Executive Director and Head of Commercial Agency.
Tenants now want more from their buildings as rents keep increasing. These demands include more natural light, better security systems, and diverse food outlets that have choices to fit the budgets of all employees. In addition to this, access to mass transit, nice lobbies and high ceilings are also important factors.
At the bottom of the Knight Frank’s office rent index were Tokyo and Manila. Each city recorded an office rental decline of 1.1 per cent in the 1st quarter from the 4th quarter of 2016. Rents in Manila had grown for more than the 3 years before this most recent quarter while the office market in Tokyo is now coming off its peak.
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