Savills announces Prime Benchmark survey results

27 September 2017

Savills releases the Prime Benchmark - the report had been prepared to provide a benchmark of occupancy costs of selective prime properties in various cities in Asia, inclusive of rents, management fees and government taxes/rate.

According to the survey, the US dollar depreciated against most Asian currencies by between 0.6% and 6.8% during the first half of 2017. This is reflected by rental values of Asia based income-producing assets becoming relatively more costly.

Offices

In local terms, prime office lease markets in most cities rose slightly but many are late in the cycle. China had a mixed picture, with Shanghai and Guangzhou rental markets showing slow growth while Beijing and Shenzhen recorded modest declines. Supported by Chinese financial businesses expansion Hong Kong outperformed other cities.

Troy Griffiths, Deputy Managing Director of Savills Vietnam, comments that in a regional context, Viet Nam office rents are relatively modest. “However with full occupancy and whole floors increasingly difficult to find, over the mid-term there is likely pressure for rents to increase”

Malls

Retail markets in the region moved by between -13.7% in Singapore and +8.3% in Osaka. The surge in Chinese and Korean visitors to Japan has boosted the retail sector there. Singapore performance slumped with the fast growing online retail segment’s increasingly negative impact on demand.

In Viet Nam, new players continue to push market dynamics. Every retail indicator is positive, however will a level of sales be achieved that justifies the continued expansion into contemporary formats?

Luxury serviced apartments

Most markets are in an early downswing stage. Average rents dropped -5.0% in Singapore and moved up 7.9% in Shenzen. In US dollar terms the majority of regional markets saw an overall increase in rents. Seoul was up 11.4 percent. 

In Viet Nam, strong FDI continues to support solid performance, second tier and SMEs are now the key focus.

Hotels

The EU visa exemption policy has had a huge impact on Ha Noi room rates. The capital city had the highest regional growth rate of 50 percent. Singapore rates were up by 11.6%, Manila by 8.9% and Kuala Lumpur by 7.4 percent. 

Outstanding performance in Viet Nam hotel markets continued, influenced by increasing numbers of China, Russia and Korea inbounds. Hospitality development is booming as domestic and international developers move to secure, or improve their positions.

 
 

Key Contacts

Dinh Huong Linh

Dinh Huong Linh

National Head of MarCom, Savills Vietnam

Savills Hanoi

+84 24 3946 1300 Ext 112

 

Nguyen Thi Kim Nga

Nguyen Thi Kim Nga

PR Manager

Savills HCMC

+84 28 3823 9205