Land of extremes: The Asia Pacific office market continues to offer good value to selective investors
The Asia Pacific office market presents a real mixed bag for investors. For the region as a whole, fundamentals are decent. For individual markets, however, it is a land of extremes. At one end of the spectrum, the Asia Pacific region boasts some of the most expensive office markets in the world; at the other end are severely oversupplied markets with astronomical vacancy rates.
In aggregate, rents are increasing, job markets are tight, and business sentiment and hiring intentions are improving, according to Dr Shane Taylor, the Hong Kong–based head of research and strategy for the Asia Pacific region with CBRE Global Investors. But the overall numbers do not reveal the extreme, almost bifurcated nature of the Asia Pacific office market. “The best-performing markets in Asia Pacific are among the best performing globally. However, some oversupplied tier II Indian and Chinese cities exhibit the worst fundamentals globally,” says Taylor.
On the positive side, Auckla