Commercial property: Beijing retail rents jump by most since 2019 with premium office space remaining under pressure
- City’s commercial real estate market recovered partially in the first quarter and is gearing up for further stabilisation this year, analysts say
- Retail property is also gaining traction on the investment front thanks to policy support for C-Reit products, JLL says
Beijing’s commercial real estate market recovered partially in the first quarter of 2024 and is gearing up for further stabilisation this year as a strong rebound in consumption and policy support combine to drive demand for leasing and investment, analysts said.
In the retail market, rents in urban Beijing rose 1.3 per cent quarter on quarter in the three months ended March 31, marking the fastest growth in this segment since 2019, according to a report published on Tuesday by real estate services company JLL.
Meanwhile, rents in the suburban retail market jumped by 2.8 per cent, which also represents the fastest growth since 2019 as well as a rebound to 2021 levels. And while rents are still nowhere near pre-pandemic levels, the outlook for the segment is generally positive, the report said.
“The demand surge is expected to continue throughout the year”, as increased leasing activity allows landlords to upgrade their tenant mix and select “higher-positioned brands” from their pool of active inquirers, said Ji Ming, research director for JLL North China.
And since these higher-end tenants are typically more willing to pay, they are expected to steadily drive up rents in the retail segment, Ji added.