Independent global property consultancy Knight Frank Asia Pacific has released its Asia-Pacific Prime Office Rental Index for Q1 2015.
The index was up slightly in the first quarter, increasing by 1.3 per cent and is now sitting at 5.3 per cent above its pre-crisis (Q2 2008) peak.
Rental growth was seen in 13 of the 19 markets tracked for the report. Three recorded no rental movement and three recorded declines.
Over the next year, Knight Frank expects rents in 14 out of the 19 markets it tracked to either remain steady or increase. This forecast is in line with previous ones.
Seoul (pictured) and Tokyo showed similar growth figures for Q1 2015 but have very different market characteristics and drivers.
Even though vacancies are tightening in several markets, the Asia-Pacific regional vacancy rate increased on the back of rising inventories in Greater China’s tier-one cities.
According to Nicholas Holt, the Head of Research for Asia Pacific, the structure of traditional Japanese leases in Tokyo, which prevents significant rental increases, has held back rental growth to only 1.9 per cent in a tight market with low vacancy rates.
