Mon, Jul 09, 2018 - Page 16 News List

Commercial property at 15-year high

HEADING NORTH:Taipei’s Neihu was increasingly popular with investors in the second quarter and responsible for NT$24.6 billion of the total NT$77.9 billion in transactions

Staff writer, with CNA

Commercial property transactions hit a 15-year high in the second quarter of the year, data from real-estate advisory firm CBRE Group Inc showed.

Sales of commercial property in Taiwan during the April-to-June period totaled NT$77.9 billion (US$2.55 billion), the highest level since the firm started to publish the statistics in 2003, CBRE said on Tuesday last week.

Transactions in the second quarter grew 165 percent from the same period last year, largely on the back of strong interest from innovative start-ups, CBRE said.

Out of the total sales value, NT$33.3 billion came from transactions of shops, factories and offices, up 154 percent from last year, while the remaining NT$44.6 billion came from land transactions, up 173 percent from last year, the data showed.

In the second quarter, Taipei’s Neihu District (內湖) became a popular destination for commercial property investors, with transactions hitting NT$24.6 billion, CBRE said.

Among the major buyers, Formosa Plastics Group (台塑集團) spent NT$18.7 billion on a property in the technology park for its headquarters, the advisory firm said.

About NT$30 billion of commercial property is for sale in Neihu, so the district could remain a hot spot for high-value transactions, CBRE said.

As for land transactions, CBRE said a local property developer purchased a plot of land of more than 1,000 ping (3,306m2), which pushed up commercial property sales in the second quarter.

With medium-sized and large companies moving to or setting up offices in Taipei, a total of 10,133 ping of A-grade offices was leased in the second quarter, CBRE said, adding that due to higher demand, the average rent for A-grade offices in Taipei rose 1.3 percent from a quarter earlier to NT$2,673 per ping, CBRE said.

CBRE said the service sector was the largest tenant in the commercial property rental market in Taipei, accounting for 39 percent of total property rented, ahead of the information technology and Internet sector (15 percent) and financial and insurance sector (12 percent).

Start-ups, including developers of electric cars, artificial intelligence technology and blockchain used as a platform for digital transactions, also took up commercial property in the Taipei rental market over the period, CBRE said.

Such start-ups are expected to remain among the major customers for Taipei commercial real estate at a time when the government is lending its support to innovative technology development, the firm added.

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