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Beijing | 2022 Q2 | Vacancy increases a slight 1% QOQ as Covid affects Beijing office market

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The Beijing Grade A office market saw little activity this quarter.

Dear Valued Client,

  • The Beijing Grade A office market saw little activity this quarter. Multiple factors contributed to the overall net absorption of −83,000 sq meters (−898,000 sq feet). New demand mainly came from financial companies, with several large leasing transactions recorded.
  • After five consecutive quarters of decline, the vacancy rate increased slightly to 16.4% in Q2 2022. Net effective rents also declined a slight 1.0% QOQ to RMB 338.6 (US$50.5) per sq meter.
  • We expect the demand, suppressed by the lockdown this quarter, to be released in the second half of the year. We suggest landlords lock-in key tenants and negotiate leases in advance while paying attention to potential for internet companies to adjust recently signed leases.
  • We expect Covid’s impact to gradually diminish in Q3 2022. The opportunity for rental negotiations will likely continue to shrink, so we advise tenants to secure their preferred space with rapid decision making.

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Beijing | 2022 Q2 | Vacancy increases a slight 1% QOQ as Covid affects Beijing office market

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