China’s digital economy is already a key driver of commercial real estate demand in major cities. As adoption of 5G, Internet of Things (IoT), Cloud Computing, Big Data, Artificial Intelligence and Blockchain, and the digitalisation of the traditional economy continues, digital economy companies’ commercial real estate strategies will exert an increasingly broader and deeper impact on the commercial property market.

This report identifies the latest factors driving the expansion of Beijing’s digital economy, assesses how these trends are impacting the city’s commercial real estate market, and identifies suitable property strategies for occupiers and investors:

• With supply and demand having gradually diverged among the city’s different established clusters, all of these factors are influencing enterprise’s site selection and office leasing strategies.
• Multi-centralisation of Beijing’s office market is accelerating, resulting in TMT companies’ greater acceptance of emerging submarkets as potential office locations. CBRE recommends TMT companies conduct detailed market studies of local industrial positioning and policies and tenant-mix when evaluating potential office space.
• Office demand from the digital economy sector has been increasingly driven by large companies in recent years. The shortage of large-scale space for lease in Beijing remains a challenge for leading companies, as the available rentable area is too dispersed to meet centralised office requirements. CBRE has identified strengthening real estate portfolio management, considering non-standard offices, purchasing office space for self-use, engaging in build-to-suit development for TMT occupiers seeking to navigate Beijing’s increasingly complex and challenging office leasing market.
• With an increasing number of traditional companies recognising that digital talent is crucial to enhancing strategic competitiveness and building soft power, many such firms, particularly those in the financial sector, are observing and learning from TMT enterprises’ workplace strategies.