Beijing MarketView Q3 2021

October 22, 2021

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Office net absorption hits record high; New infrastructure emerges as investment focus



Overall net absorption increased by 18% q-o-q to 352,700 sq. m., a record high. TMT firms contributed 43% of total new leasing volume as several leading companies in the sector completed large-size transactions. Four new office buildings providing a total GFA of 283,000 sq. m. were completed in the CBD and Lize.



New supply in Q3 2021 included the 105,000 sq. m. GFA Xiyue Paradise Walk, which come on stream fully leased. F&B retailers remained active, led by coffee and tea brands. Six projects providing a total GFA of 369,000 sq. m. are scheduled to come on stream in the next six months.



No new logistics supply was added to the market this quarter. Demand continued to be led by e-commerce platforms and Third-Party Logistics (3PL) firms. Two new logistics facilities are scheduled to be completed over the next six months, providing a total GFA of 117,000 sq. m..



Three new projects in Z-Park, Fengtai and BDA area were delivered to the market this quarter, providing a total GFA of 594,000 sq. m.. TMT continued to drive demand for business park space, with traditional internet companies and integrated circuit firms most active.



Eleven investment transactions were closed in Q3 2021, totalling RMB 8.1 billion. As all deals were below RMB 2 billion and eight were below RMB 1 billion, total investment volume declined q-o-q, while y-t-d investment volume remained flat y-o-y. Assets related to ‘new infrastructure’, such as data centres, were keenly sought-after, accounting for 21% of total investment volume this quarter.