Grade A office rents seen to climb 15%
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Grade A office rentals are expected to climb by as much as 15 percent this year in Shanghai, with the Puxi area continuing to outperform Pudong, a major international real estate services firm predicted yesterday.
Office rents in Puxi may rise 15 percent over the next 12 months while they will likely gain 10 to 15 percent on the other side of the Huangpu River, according to Jones Lang LaSalle's latest research.
"Continued strong demand from multinational companies and a limited amount of available space is leading to a rapid rise in rents in Puxi," said Anthony Couse, managing director of Jones Lang LaSalle Shanghai.
"Meanwhile in Pudong, the market has also been registering robust demand from both overseas and domestic financial firms since the last quarter of 2010."
Grade A office rents rose 7.1 percent to 7.60 yuan (US$1.14) per square meter per day in Puxi in the fourth quarter of last year, the fastest quarterly increase since 2005, the company's data showed.
During the same period, rents across the river in Pudong also rebounded 5.8 percent quarter on quarter to 7.40 yuan per square meter per day, the firm said.
On the supply side, nearly 1 million square meters of new Grade A office space will come on the market across the city this year, with more than two-thirds of them being located in Pudong.
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