Beijing pre-sales on rise

THERE are signs that the Beijing office market is beginning to ease with more new office under construction, but the more recent the pre-sales of new developments the higher prices have been set, property consultant Brooke Hillier Parker says.

Sales prices ranged from US$195 to $250.8 per square foot for projects due for completion this year and launched for sale in 1993.

Projects offered for sale last year and to be completed in 1996 and 1997 have increased between 19 per cent and 33 per cent, to a range of $232.3 and $344 per square foot.

With Beijing's blanket ban on approvals for new projects, rising demand in a tight market supply saw rents jump 62 per cent in the first quarter of the year. The consultancy said the monthly rent in the China World Trade Centre had risen to more than $8.36 per square foot. Jincheng Centre has a monthly asking rent of $4.2 per square foot.

The strong demand against a background of tight supply has seen companies setting up shop in hotels and guest houses. About 10 per cent of hotel guests have been long-term tenants signing minimum lease terms of one to two years.

The growth of the tourism industry, however, has resulted in hotels being less keen to lease rooms on a long-term basis.

The average rate for long-term leasing has jumped to between 60 and 70 per cent of the listed normal rate.