Tenants who are relocating to newer office buildings chiefly took advantage of the contracted rent in the CBD. Nevertheless, as this predominantly involves movements to other locations, occupancy level was fairly unchanged in Q2 2019.
Competition amongst office space providers in securing tenants heightened as landlords began offering rental price cuts, primarily for big transaction volumes of well- known tenants.
In order to run the operation, a new office building should ideally secure the commitments of big/anchor tenants before they complete construction. Otherwise, landlords need to be flexible in accommodating prospective tenants that now have a number of options to choose from. Other than offering competitive rents, giving fit-out allowances is still effective in luring in tenants.