Oversupply coupled with the effects of regional economic turmoil took their toll on the property market in China's major cities last year, causing rents and prices in the office and residential sectors to decline further in the fourth quarter, according to a property report. Property consultants C Y Leung & Co said in its latest Property Times report that the office and residential sectors in Shanghai, Beijing and Guangzhou continued to soften in the last quarter. Although office leasing activities in Shanghai showed signs of picking up due to low occupancy costs, the report said some companies remained cautious about expanding after the financial and stock crisis in Asia. The report said oversupply forced office rents in Shanghai down 7.5 per cent, while office prices fell 2.6 per cent from the previous quarter. Last year, new supplies of office space in Shanghai amounted to 21.52 million square feet. This represented year-on-year growth of 35 per cent. C Y Leung said multinational companies took advantage of the increase in prime office space to relocate or expand their operations. But sales remained quiet as buyers became more restrained in the face of massive supply. In the residential sector, Shanghai reported a 11.5 per cent decline in rents and 2.3 per cent fall in values. The downturn in Beijing's residential and office sectors was relatively moderate. Office prices and rents stayed firm, with downward adjustment of less than 1 per cent. The leasing market was more active towards the end of last year, but office sales in the city remained slow as companies anticipated further downward pressure on prices from new supply this year. Beijing residential prices for the period fell 2.3 per cent, and rents were down 0.2 per cent. Leasing focus was on Riviera Garden, Regent Court and Fairview Tower. The report said sales activity in Beijing's residential market was subdued in the last quarter as companies from South Korea, Hong Kong and Singapore slowed investments, partly due to the region's economic turmoil. The Guangzhou office market continued to cool in the fourth quarter, with rents down 9.7 per cent and prices down 1.3 per cent from the previous quarter. C Y Leung said the region's economic downturn had slowed the take-up rate in Guangzhou's office market as companies adjusted their expansion plans. Samsung, for example, which was moving to Citic Plaza, had adjusted its scale of expansion and was taking a smaller floor area than it previously planned, the agent said. Residential rents in Guangzhou edged further downwards by 2.3 per cent from the previous quarter, but prices stayed firm with a 0.4 per cent drop.