New | Office take-up grows in China’s 16 cities, but rents decline

Across the 16 cities surveyed, leasing activity picked up further from the last quarter in nearly all of the cities tracked, with the exception of Dalian and Hangzhou where market conditions were relatively inactive.

But a sharp pick up in the third quarter office leasing activity did not necessarily push up rents, according to the SCMP-DTZ/Cushman & Wakefield mainland office rental index shows.

The index, issued quarterly by the South China Morning Post and property consultancy DTZ, reports office rental performance in 16 mainland cities. It was developed with a base value of 100 at the first quarter of 2013.

Amongst the cities tracked, about seven of the witnessed a softening trend in office rents over the past quarter. The remaining 9 cities saw some positive growth, but amongst them, the rental growth for four of the 9 was below one per cent.

Qingdao recorded the sharpest quarterly growth at 3.5 per cent, followed by Shanghai at 2.1 per cent. Shenzhen continued to record positive quarterly growth of 1.8 per cent quarter-on-quarter.

Xi’an, by contrast, recorded the sharpest drop in rents amongst the cities tracked, with office rents declining by 3.9 per cent quarter-on-quarter.