What’s new: More than 18% of office spaces in Beijing were left vacant during the second quarter — the most in nearly 13 years — as businesses are reluctant to expand amid a cooling economy.
The second-quarter vacancy rate of office buildings in the capital reached 18.3%, up 1.5 percentage points from the previous quarter. The rate is the highest since the first quarter of 2010, data from real estate service provider Savills showed.
During the second quarter, the net absorption volume for office space in Beijing was negative 13,500 square meters, according to Savills. The negative figure means more tenants terminated leases than new tenants signed up.
Background: Beijing has recorded negative net absorption volume for office space for three consecutive quarters, indicating weakening rental demand. Data from the first half is a negative 16,700 square meters, the first time the city’s half-year data fell into negative territory.
Office rental market in major Chinese cities, including Beijing and Shenzhen, has remained sluggish this year and a post-pandemic recovery has been slower than expected. Many companies relocated or postponed new leasing plans during the pandemic and they have remained cautious to step up expansion amid the slow business recovery, analysts said.
Contact reporter Han Wei (weihan@caixin.com)
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