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Asia Pacific Figures Q2 2022

11 Aug 2022

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–Office: Net absorption grew by 10% q-o-q to 12.8 million sq. ft. NFA. Demand for prime and new buildings remained strong as occupiers continued to pursue flight-to-quality relocations. Supply chain disruption and an already thin pipeline ensured new Grade A supply remained low at 9.3 million sq. ft. NFA. Vacancy fell by 5 bps to 17.3% while rents rose by 0.5% q-o-q.

–Retail: Except for mainland China, leasing activity continued to recover in Q2 2022. New demand remained driven by café, tea, and light food retailers. The rental decline slowed to 1.1% q-o-q as rents in most markets remained flat or fell slightly.

–Logistics: Leasing activity cooled across Asia this quarter, with several markets reporting a slowdown in demand from e-commerce and related 3PLs. Vacancy nevertheless remained low regionwide. While rents rose by a further 2.3%, marking the strongest quarterly growth in a decade, growth is becoming increasingly bifurcated.

–Investment: Faster-than-expected interest rate hikes weighed on investment sentiment in Q2 2022, leading commercial real estate investment volume to decline by 28% y-o-y to US$29.1 billion. Purchasing continued to be led by real estate funds, property companies, REITs and institutional investors.