The value of Taiwan’s commercial property transactions is set to grow 10 percent annually this year, with office rental rates to increase by 5 percent, Jones Lang LaSalle forecast yesterday.
The international property consultancy attributed its rosy forecast to improving global economic indicators and the continuing robustness of market transactions.
The positive outlook stands in stark contrast to the warnings of impending market corrections that its peers issued recently.
“We expect commercial property transactions to exceed NT$100 billion (US$3.29 billion) this year, which is an increase of approximately 10 percent from the NT$90.5 billion recorded last year,” Jones Lang LaSalle Taiwan (仲量聯行) managing director Tony Chao (趙正義) told a media briefing.
Domestic life insurance companies, which were banned from making property investments for most of last year, may increase their stakes as they shift away from Taipei to New Taipei City (新北市) and other areas to meet the minimum investment yield requiremed by regulators, Chao said.
Insurers are seeking property that can generate a rental yield of at least 3 percent, higher than the 2.875 percent limit set by the Financial Supervisory Commission, he said, adding that such returns hover at about 2.5 percent in Taipei due to the steep price hikes that have occurred in recent years.
The US Federal Reserve’s planned tapering of its quantitative easing program is likely to have only a limited impact on Taiwan’s commercial property market, given that offshore funds contributed just 9 percent to the nation’s overall trading last year, Chao said.
Warming cross-strait ties are set to continue propping up the market, as more local owners look to convert old office buildings into hotel and retail spaces, and Chinese developers make plans to build vacation homes in central and southern Taiwan, he said.
As for the leasing market, Jones Lang LaSalle, which accounts for 60 percent of the local Grade-A office space market, expects rental rates to climb by 5 percent this year, after rising 3.3 percent to NT$2,471 per ping (3.3m2) last year.
Jones Lang LaSalle marketing director Joe Lin (林大喬) attributed last year’s pickup mainly to strong demand from financial services providers that are expected to continue driving the market this year.
For example, Hua Nan Financial Holding Co (華南金控) and Taiwan Cooperative Financial Holding Co (合庫金控) are poised to finish building their new headquarters in Taipei’s Xinyi District (信義) and Songshan District (松山) respectively.
About 71,000 ping of office space is to become available on the market this year, with owners predicted to take up a majority of that space, he said.
The vacancy rate in offices dropped to 10.5 percent last quarter, while the annual reading edged up 0.2 percentage points from a year earlier, Lin added.
Nvidia Corp’s demand for advanced packaging from Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) remains strong though the kind of technology it needs is changing, Nvidia CEO Jensen Huang (黃仁勳) said yesterday, after he was asked whether the company was cutting orders. Nvidia’s most advanced artificial intelligence (AI) chip, Blackwell, consists of multiple chips glued together using a complex chip-on-wafer-on-substrate (CoWoS) advanced packaging technology offered by TSMC, Nvidia’s main contract chipmaker. “As we move into Blackwell, we will use largely CoWoS-L. Of course, we’re still manufacturing Hopper, and Hopper will use CowoS-S. We will also transition the CoWoS-S capacity to CoWos-L,” Huang said
Nvidia Corp CEO Jensen Huang (黃仁勳) is expected to miss the inauguration of US president-elect Donald Trump on Monday, bucking a trend among high-profile US technology leaders. Huang is visiting East Asia this week, as he typically does around the time of the Lunar New Year, a person familiar with the situation said. He has never previously attended a US presidential inauguration, said the person, who asked not to be identified, because the plans have not been announced. That makes Nvidia an exception among the most valuable technology companies, most of which are sending cofounders or CEOs to the event. That includes
INDUSTRY LEADER: TSMC aims to continue outperforming the industry’s growth and makes 2025 another strong growth year, chairman and CEO C.C. Wei says Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), a major chip supplier to Nvidia Corp and Apple Inc, yesterday said it aims to grow revenue by about 25 percent this year, driven by robust demand for artificial intelligence (AI) chips. That means TSMC would continue to outpace the foundry industry’s 10 percent annual growth this year based on the chipmaker’s estimate. The chipmaker expects revenue from AI-related chips to double this year, extending a three-fold increase last year. The growth would quicken over the next five years at a compound annual growth rate of 45 percent, fueled by strong demand for the high-performance computing
TARIFF TRADE-OFF: Machinery exports to China dropped after Beijing ended its tariff reductions in June, while potential new tariffs fueled ‘front-loaded’ orders to the US The nation’s machinery exports to the US amounted to US$7.19 billion last year, surpassing the US$6.86 billion to China to become the largest export destination for the local machinery industry, the Taiwan Association of Machinery Industry (TAMI, 台灣機械公會) said in a report on Jan. 10. It came as some manufacturers brought forward or “front-loaded” US-bound shipments as required by customers ahead of potential tariffs imposed by the new US administration, the association said. During his campaign, US president-elect Donald Trump threatened tariffs of as high as 60 percent on Chinese goods and 10 percent to 20 percent on imports from other countries.
RSS