Beijing Figures Q1 2022

Most sectors register steady leasing activity as investment shows signs of recovery

Office

Three new projects came on stream including the first batch of prime offices in Jinzhan. Citywide net take-up declined 66% q-o-q amid consolidation by SoEs and leading TMT companies. Take-up in new projects was slow while vacancy and rental performance within existing buildings was mixed.

Retail

The quarter saw the re-opening of Dong An Market in Wangfujing as a multi-brand boutique store. Several core malls introduced new luxury brands and high-end restaurants while chain coffee & tea and entertainment stores opened in regional malls. Rents in prime submarkets stayed firm.

Logistics

Leasing activity continued to recover, supported by demand from by 3PLs and consumer manufacturing firms. Shunyi Airport Zone and Daxing were the most active submarkets. The shortage of space for lease pushed up average rents further this quarter.

Business Park

Two new projects were delivered in Dongsheng and BDA targeting the intellectual manufacturing and life sciences industries, respectively. Leasing activity slowed, with Z-Park recording negative net absorption. Average rents fell by 0.1%.

Investment

Quarterly volume fell below RMB 2 billion for the first time since 2016. Office self-use buyers remained active while purchases of retail properties for future office conversion also picked up. With developers becoming more willing to dispose of high-quality assets, there is now a window of opportunity for investors.