Outlook positive for Asia Pacific prime office rents

Improving economic growth prospects in Asia Pacific supported the region’s prime office markets during second quarter 2018, according to Knight Frank’s Asia-Pacific Prime Office Rental Index, which rose 2.4 percent quarter-on-quarter and 4.3 percent year-on-year in the second quarter. A rebound in major market consumption metrics, economic expansion trends and accommodative financial stances suggest second half 2018 will see rents remain steady — or increase marginally — for the remainder of 2018.

During second quarter 2018, the supply-constrained cities of Bengaluru, India; Hong Kong; Tokyo; and Sydney were the main drivers of prime office rental growth in the region. In Bengaluru’s CBD, rents rose 7.0 percent quarter-on-quarter (8.5 percent year-on-year), and are expected to increase during the next 12 months, according to Knight Frank. Tokyo’s central five wards saw a 5.5 percent increase in prime office rents quarter-on-quarter (6.3 percent year-on-year), with growth projected to remain steady in the coming 12 months. Sydney’s CBD experienced a 4.2 percent quarter-on quarter increase (13.3 percent year-on-year), with rental growth forecast to rise during in the next 12 months. And in Hong Kong Central, prime office rental growth gained 1.7 percent quarter-on-quarter (6.7 percent year-on-year) and is projected to increase in the coming 12 months.