The Grade A office market in Taipei has recovered from the global financial crunch, although few transactions were seen in the first quarter of the year, traditionally a slow period, international real-estate service provider Jones Lang LaSalle said yesterday.
The overall vacancy rate in the office market dropped to 15 percent in the first quarter from 16.1 percent in the previous quarter, the company said, adding that the pace of companies returning leased space had eased thanks to decreasing office rent costs.
“The first quarter of this year recorded a positive net take-up for the second successive quarter at 5,898 ping (19,463.4m²), an improvement from the previous quarter,” Tony Chao (趙正義), managing director of the company’s Taipei branch, told a media briefing.
But Chao said the current net take-up came from leasing contracts in the second half of last year and that some well-known foreign enterprises were planning to relocate to the outskirts of Taipei City, which will lead to accumulated returning space of 25,000 ping in the Grade A office market.
“To save rental costs, some enterprises are likely to move out to suburban areas such as Neihu (內湖) and Nangang (南港), where there is easy access to public transportation, shops and services,” said Sherry Wu (吳瑤華), director of the realtor’s commercial property market department.
“This trend may have a severe impact on the Grade A office market,” she said.
The overall rental rate for office space declined slightly by 0.16 percent to NT$2,367 per ping a month in the first quarter with the Dunhua South district seeing a small rebound at 1.41 percent to reach NT$2,355 per ping a month, the company’s data showed.
In the first quarter, NT$14 billion (US$443 million) worth of investment-grade properties changed hands, the report said, adding that three life insurers, including Cathay Life (國泰人壽), China Life (中國人壽) and Bank Taiwan Life (台銀人壽), were involved in transactions that accounted for NT$4.8 billion.
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