Commercial real-estate transactions last year reached a record low, an annual report published on Wednesday by property consultancy Colliers International Taiwan (高力國際) showed.
As of Tuesday, commercial property transactions totaled NT$47 billion (US$1.57 billion), down 33.14 percent from NT$70.3 billion in 2016, tallies compiled by Colliers showed.
Colliers International Taiwan managing director Andrew Liu (劉學龍) blamed the decline on capital reallocation among major investors, the effects of government housing policies and greater price differences between potential sellers and buyers.
Moreover, a capital gains tax of 35 percent for foreign investors on property transactions also caused institutional investors to take a wait-and-see approach to such investments, Chinese-language media cited Liu as saying.
In terms of major buyers, life insurance companies spent just NT$4.3 billion on commercial properties last year, compared with the NT$600 billion they spent on stock market investments, Colliers said.
Commercial property transactions have been contracting since 2011, Colliers said, adding that the number for last year was only 36.8 percent of what is was in 2011, when it reached its peak at NT$127.7 billion, and 67 percent of 2008’s figure of NT$70.6 billion at the start of the global financial crisis.
The sale in July of Bellazza Taipei Hotel (台北和璞飯店) in Taipei’s Dazhi (大直) area to Sprinta Inc for NT$5.58 billion led the year’s commercial property transactions, Colliers said.
Fubon Life Insurance Co’s (富邦人壽) sale of Nice Plaza (耐斯廣場) in Chiayi for NT$4.83 billion was the second-largest deal, followed by CTBC Asset Management Co’s (中信資產管理) purchase of office spaces in several units of Uni-President International Building (統一國際大樓) in Taipei for NT$3.51 billion, the broker said.
Meanwhile, land deals appeared in better shape, with sales totaling NT$118.7 billion, up NT$10 billion, or more than 9 percent, from the previous year, Colliers said.
Colliers research director Paul Lee (李日寶) said the increase was driven by builders and developers, who were more active about increasing their stock of land.
Highwealth Construction Co (興富發建設) stood out as the most aggressive buyer, purchasing nearly NT$10 billion in land and accounting for 15 percent of all land bought by local firms, Lee said.
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