Monthly retail rates for Taipei’s grade-A offices last year increased by 3.2 percent to NT$t2,975 per ping (3.3m2), driven by strong demand, but limited supply despite the lingering COVID-19 pandemic, real-estate agency Jones Lang LaSalle Taiwan Ltd (JLL Taiwan, 仲量聯行) said last week.
Monthly rent exceeded NT$4,000 per ping for most upscale offices in the city’s Xinyi District (信義) and could climb higher this year when new office spaces join the market, the company said.
The data showed that enterprises still have solid demand for high-quality office spaces, it said.
Photo: Hsu Yi-ping, Taipei Times
However, it remains to be seen if landlords would continue to have the upper hand, as interest rate hikes by domestic and foreign central banks slow economic growth and turn companies cautious on leasing decisions, JLL Taiwan said.
Office vacancy rates in Taipei averaged 2.6 percent last year, below 3 percent for four years in a row, the agency said, adding that the city’s figure compared with 7 percent in the Asia-Pacific region and 14 percent globally.
The local market showed the vacancy rate was more than 2 percent lower in Xinyi District — where potential tenants had difficulty finding office spaces due to a lack of supply — than other districts last year, JLL Taiwan said.
The Taipei market could see the entry of 45,000 ping of grade-A offices this year, mainly in Xinyi District, JLL Taiwan senior market director Brian Liu (劉建宇) told a news conference on Thursday last week.
The new office spaces would inject vitality into the market and ease the supply crunch, Liu said.
Second-tier areas such as Nangang District (南港) could become the next bright spot with 48,000 ping of new offices to become available over the next few years, due to the city government’s effort to build a new industrial cluster there, he said.
Environmentally-friendly and newly-built office spaces would gain popularity as companies assign increased importance to net zero carbon emissions, JLL Taiwan said.
Old office buildings could be forced out of the market unless they meet sustainability requirements through the urban renewal process, the company said.
On the other hand, inflation, monetary tightening and other economic headwinds would constrain leasing demand, it said.
The Financial Supervisory Commission last month raised the required minimum yield on property investments to 2.72 percent for life insurers, after the central bank adopted several interest rate hikes last year.
If interest rate hikes continue this year, the required minimum yield could exceed 3 percent by the end of this year, JLL Taiwan investment manager Sherry Wu (吳瑤華) said.
Investable properties would likely become scarce for life insurers and could affect the industry’s overall investment, she added.
The life insurance industry struggles to find investable property targets in Taipei and New Taipei City due to the relatively higher home prices in those areas, Wu said.
However, some commercial offices and leaseback factories in southern Hsinchu still support a yield of more than 3 percent, she added.
UNPRECEDENTED PACE: Micron Technology has announced plans to expand manufacturing capabilities with the acquisition of a new chip plant in Miaoli Micron Technology Inc unveiled a newly acquired chip plant in Miaoli County yesterday, as the company expands capacity to meet growing demand for advanced DRAM chips, including high-bandwidth memory chips amid the artificial intelligence boom. The plant in Miaoli County’s Tongluo Township (銅鑼), which Micron acquired from Powerchip Semiconductor Manufacturing Corp (力積電) for US$1.8 billion, is expected to make a sizeable capacity contribution to the company from fiscal 2028, the company said in a statement. It would be an extended production site of Micron’s large-scale manufacturing hub in Taichung, the company said. As the global semiconductor industry is racing to reach US$1 trillion
Singapore-based ride-hailing and delivery giant Grab Holdings Ltd has applied for regulatory approval to acquire the Taiwan operations of Germany-based Delivery Hero SE's Foodpanda in a deal valued at about US$600 million. Grab submitted the filing to the Fair Trade Commission on Friday last week, with the transaction subject to regulatory review and approval, the company said in a statement yesterday. Its independent governance structure would help foster a healthy and competitive market in Taiwan if the deal is approved, Grab said. Grab, which is listed on the NASDAQ, said in the filing that US-based Uber Technologies Inc holds about 13 percent of
Taiwan’s food delivery market could undergo a major shift if Singapore-based Grab Holdings Ltd completes its planned acquisition of Delivery Hero SE’s Foodpanda business in Taiwan, industry experts said. Grab on Monday last week announced it would acquire Foodpanda’s Taiwan operations for US$600 million. The deal is expected to be finalized in the second half of this year, with Grab aiming to complete user migration to its platform by the first half of next year. A duopoly between Uber Eats and Foodpanda dominates Taiwan’s delivery market, a structure that has remained intact since the Fair Trade Commission (FTC) blocked Uber Technologies Inc’s
Memory chip stocks extended their losses yesterday after Alphabet Inc’s Google publicized research that could allow more efficient use of the storage needed for artificial intelligence (AI) development. SK Hynix Inc and Samsung Electronics Co, South Korean leaders in the market, fell more than 6 percent and about 5 percent respectively in Seoul. In the US, Micron Technology Inc, Western Digital Corp and Sandisk Corp slid more than 2 percent in pre-market trading, after they all closed lower on Wednesday. Memory companies have been on a tear in recent months as the rapid development of AI infrastructure triggered a spike in chip
RSS