Rents for Grade-A office space in Bangkok increased by 1.7 percent quarter-on-quarter during the final three months of 2013, according to research published today by Knight Frank.
Despite unrest in Thailand’s capital city, Grade-A rents grew as a result of falling vacancy rates and net absorption of 39,000 sqm during Q4 2013.
The agency noted that although the uncertainty caused by ongoing events is likely to soften demand over the coming months, the lack of new supply is likely to underpin further rental growth in 2014.
Globally, Knight Frank’s Asia-Pacific Prime Office Rental Index edged up 0.8 percent in Q4 2013. Only six on the 19 tracked markets saw rental declines over the period as net absorption bounced back, increasing 19 percent on the previous quarter to give a strong end to the year, most notably in Southeast Asia.
Region-wide vacancy rates increased slightly to 12 percent on the back of significant construction completions
Jakarta and Tokyo’s Grade-A office markets saw 8.4 percent and 4.2 percent rental growth respectively in Q4 2013, the two highest growth rates in the region during the quarter
Elsewhere in Southeast Asia, Malaysia and Vietnam look to be at the bottom of cycle, and while there is a feeling that things can only get better in Vietnam, the Kuala Lumpur office market is likely to remain sluggish, with a high vacancy rate.
Nicholas Holt, Head of Research for Asia Pacific, Knight Frank Asia Pacific, said: ”While the global economy is showing more green shoots of recovery, with a strengthening of western economies likely to stimulate multinational occupier demand in the region, the tightening of monetary conditions still poses a threat in certain markets.”
Andrew Batt, International Group Editor of PropertyGuru Group, wrote this story. To contact him about this or other stories email andrew@propertyguru.com.sg
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