Transactions of commercial property in Taiwan fell to a seven-year low last year at a time when the local economy was slowing down, according to a recent research report.
Citing the report, international property consultancy DTZ Debenham Tie Leung (戴德梁行) said that transactions of office and shop space in Taiwan totaled NT$77.86 billion (US$2.32 billion) for the whole of last year, down 14 percent from the previous year.
Last year’s transaction value even fell to the lowest level since 2008 due to poor performance in the local economy, DTZ said.
Taiwan’s economy grew only 0.85 percent last year, the slowest growth in six years, compared with a 3.92 percent increase seen in 2014, according to government statistics released on Jan. 29.
In addition to the weaker economic fundamentals, DTZ said political uncertainty ahead of the presidential and legislative elections on Jan. 16 further dampened sentiment in the local commercial property market last year, while a tax reform to collect capital gains in property transactions also drove many investors to the sidelines.
FOURTH QUARTER
Transactions picked up significantly in the fourth quarter of last year, spiking to NT$48.92 billion, accounting for more than half of the total last year, but the increase failed to help the local commercial property sector climb out of the doldrums for the whole year, DTZ said.
The soaring transactions in the fourth quarter were largely due to investors wanting to avoid being taxed under the reformed tax law, which took effect from Jan. 1 this year.
The law aims to curb property market speculation by imposing a capital gains tax of up to 45 percent on people who sell their commercial or residential property within a certain period of time from the date of purchase.
LIFE INSURERS
DTZ said that the increase in transactions in the fourth quarter also resulted from a move by the government to lower the investment return requirement imposed on local life insurance companies for their property investments to 2.555 percent from the previous 2.805 percent.
The cut in the return requirement, starting from November last year, has prompted several major life insurers to jump into the local commercial property market and buy, which boosted the transactions in the fourth quarter.
On the back of a decline in commercial property supply in the fourth quarter, rents in grade-A offices, in particular in Taipei showed signs of increasing, DTZ said.
The average office rental price in Taipei during the October-to-December period hit NT$2,510 per ping (3.3m2) a month, up 0.4 percent quarter-on-quarter and 2.2 percent year-on-year to mark the highest quarterly level in three years, the report showed.
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Huawei Technologies Co’s (華為) latest smartphones carry a version of the advanced made-in-China processor it revealed last year, results from an independent analysis showed. This underscored the Chinese company’s ability to sustain production of the controversial chip. The Pura 70 series unveiled last week sports the Kirin 9010 processor, research firm TechInsights found during a teardown of the device. This is a newer version of the Kirin 9000s, made by Semiconductor Manufacturing International Corp (SMIC, 中芯) for the Mate 60 Pro, which had alarmed officials in Washington who thought a 7-nanometer chip was beyond China’s capabilities. Huawei has enjoyed a resurgence since
purpose: Tesla’s CEO sought to meet senior Chinese officials to discuss the rollout of its ‘full self-driving’ software in China and approval to transfer data they had collected Tesla Inc CEO Elon Musk arrived in Beijing yesterday on an unannounced visit, where he is expected to meet senior officials to discuss the rollout of "full self-driving" (FSD) software and permission to transfer data overseas, according to a person with knowledge of the matter. Chinese state media reported that he met Premier Li Qiang (李強) in Beijing, during which Li told Musk that Tesla's development in China could be regarded as a successful example of US-China economic and trade cooperation. Musk confirmed his meeting with the premier yesterday with a post on social media platform X. "Honored to meet with Premier Li