AT least 100 grade A office buildings, located on both sides of the Huangpu River, are due to be completed in the next couple of years, according to German property consultancy Fiducia. And Brooke Hillier Parker's Shanghai office predicts that about 10.7 million sq ft of new grade A office space will be available next year and 32.3 million sq ft by 1997. In the past, some multi-national companies in Shanghai have had to operate out of hotel rooms because of a lack of space. Rents and sale prices of office space are expected to fall next year. But that is good news only for those who can afford to wait as competition is heavy for existing office space. According to Brooke Hillier Parker's October report on the Shanghai property market, much of the existing space is poor. Despite this, rents remain high because of the short supply. Current rents for grade A office space average at about US$6 a square foot a month, and half this amount for grade B offices. The small amount of space for sale goes for about $325 a square foot on a 50-year lease. Consultants say that despite the new buildings, office space will still be limited and prices will remain high. Occupancy rates are close to 100 per cent now and all major office buildings have waiting lists. Many companies are lodged in temporary offices and hotels. Every five-star hotel in the city houses at least 20 representative offices of companies from all over the world. The Shanghai Hilton in Jingan district has 20 companies setting up representative offices in the hotel, while the Westin Shanghai in Hongqiao district has another 20. Hongqiao, tipped as an up-and-coming district, is a popular office location near the city's international airport. There are several existing office developments including the International Trade Centre, Shartex Plaza, New Town Mansions and Golden Bridge Mansions in the district. In addition, there is the Jinming Building which is a dual use office-residential building where units function both as offices and homes. Several developments in the district under construction include Sun Plaza, which will have a gross floor area of 778,721 sq ft when completed in early next year. Shanghai Plaza will have 430,560 sq ft when completed in June 1997 and Zhongsheng Financial Centre 344,448 sq ft when completed at the end of next year. The report also names the central districts of Jingan, Huangpu and Luwan as popular locations for offices. It said Shanghai Centre, next to the five-star Portman Shangri-La hotel, continued to achieve the highest rents in Shanghai, at $8.36 per square foot per month. But the shortage is so chronic that offices located in non-prime locations are selling well, with many being bought up by speculators rather than users. Brooke Hillier Parker's James Hawkey said people with offices in hotels and old buildings would move at the first opportunity. 'But if everybody upgrades themselves, there is still no way in the short term the amount can be absorbed.' Colliers Jardines' David Wong said rental prices would escalate but by the end of next year rates would ease off. 'Tenants will become more selective as they have a bigger choice,' he said.