With the economic outlook in the capital improving, the vacancy rate and rentals for grade-A office space in Taipei both fell in the first quarter, several international real-estate firms said in their quarterly research reports.
According to the local branch of CB Richard Ellis Ltd, the monthly rentals for grade-A offices in Taipei declined for the 13th consecutive quarter, falling 0.46 percent to NT$1,951 per ping in the first quarter -- a smaller decrease than the previous quarter's 1 percent decline.
"The results were in line with expectations as they continued to reflect resilient attitudes from landlords concerning rent reduction and continued `flight to quality' by tenants," the international real-estate firm's report said yesterday.
Taipei's grade-A office vacancy rate also fell for the second consecutive quarter to 12.55 percent, 0.44 percentage points down from the previous quarter, the report said.
The company's research, however, found that rentals in Taipei's prime office space -- the best of the grade-A space -- rose for the first time in 13 quarters, by 0.1 percent to NT$2,213 per ping, while vacancy rates declined for the second consecutive quarter to 12 percent, down 0.41 percentage points from the previous quarter, since no new prime office building supply entered the market and demand held steady.
Based on the first quarter's performance, CB Richard Ellis forecasts rentals for grade-A offices in the second quarter to "continue to stabilize at current levels with vacancies likely to decrease."
Given lower rentals, CB Richard Ellis yesterday concluded that relocation to grade-A and prime offices will continue throughout the year, while the average space requirement will be smaller than last year since many major multinational tenants have already moved.
DTZ Debenham Tie Leung International Property Advisers also said that the first quarter's vacancy rate for grade-A offices declined.
It said the rate fell to 11.6 percent, with monthly rentals averaging NT$2,026 per ping -- a 1.1 percent decline from the previous quarter.
With no new supply in the coming months, DTZ Debenham Tie Leung also believes that rentals will level out in the first quarter.
Although commercial-property investments slowed as a result of political uncertainty after the March presidential election, DTZ Debenham Tie Leung believes a better-than-expected economic recovery will boost investors' confidence in the near future.
Meanwhile, CB Richard Ellis revised its view of how the completion of Taipei 101, with between 30,000 ping and 60,000 ping of office space, would affect the market.
Previously the company had said that the world's tallest building would help "pull" average rentals higher.
But the real-estate firm's latest report said that "unless demand improves substantially or available supply is reduced, it is likely that average grade-A office rentals could readjust downwards."
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to