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Ofce Leasing Market

Confdence Survey
Asia | Ofce
3Q 2014
Executive Summary
Te latest Colliers Asia Ofce Leasing Market Confdence Index
shows that market confdence improved over the past year,
standing at 65.3% in 3Q 2014 the strongest since the survey
commenced in 2012. Te continuous improvement in business
sentiment comes as the US economic recovery reached its fastest
pace in more than two years and the steady growth outlook for
Asia. Recent indicators are consistent with this outlook - the
International Monetary Fund forecasted economic growth in the
0.0%
25.0%
50.0%
75.0%
100.0%
2Q 12 3Q 12 4Q 12 1Q 13 2Q 13 3Q 13 4Q 13 1Q 14
6
5
.
3
%
6
4
.
2
%
5
5
.
1
%
5
7
.
1
%
6
4
.
4
%
5
7
.
6
%
4
9
.
4
%
5
2
.
3
%
5
3
.
0
%
2Q 14 3Q 14
6
1
.
7
%
Colliers Asia Ofce Leasing Market
Confdence Index
Source: Colliers
Long-term average (2012-2013)
57.9%
Te readings of the Index and Sub-Index fall within the range of 0% to 100%.
A reading above 50% indicates the market trend is generally improving ; below 50% indicates that it is generally declining.
region to grow to 5.4% in 2014 and 5.5% in 2015, a modest upturn
over 2013.
Although the growth trend in Asia remains positive, Asia is also
facing various risks originating from within the region such as
the slow export recovery and slow structural reforms in mainland
China. Te much anticipated interest rate hike next year adds
another major concern for the market.
Nonetheless, Asia will continue to be the fastest growing region
with our brokers confdence on ofce rentals expectations at a
record-high. At the same time, most ofce tenants were generally
more confdent in taking on additional ofce space while the
level of new leasing inquiries remained largely the same.
2 Ofce Leasing Market Confdence Survey | 3Q 2014 | Ofce | Colliers International
Colliers Asia Ofce
Leasing Survey Results
New Leasing Inquiries Clients Real Estate Requirements
Rental Expectations Landlords Expectations
Te New Leasing Inquiry Sub-Index signalled its frst
decline in 2014 following an increase in the prior three
quarters and stands at 63.6% in 3Q 2014.
With a modest improvement in the Real Estate
Requirements Sub-Index to 70.4% in 3Q 2014, most
ofce tenants were generally more confdent in taking on
additional ofce space.
Te Rental Expectations Sub-Index continues to improve
and rose to 78.2% in 3Q 2014 9.4 basis points above its
long-term average (68.7%).
Te Landlords Expectations Sub-Index recorded the largest
improvement across the board (+14.6 basis points) during
the quarter from 42.8% in 2Q 2014 to 49.0% in 3Q 2014.
New Leasing Inquiry Sub-Index Real Estate Requirements Sub-Index
Rental Expectations Sub-Index Landlords Expectations Sub-Index
With the sub-index edging down slightly by 3.4 basis points,
but remaining above the 50.0% mark, most of our brokers
indicated the level of new leasing inquiries in 3Q 2014
stayed about the same compared to the previous quarter.
Breaking down by key business sectors, the most active
ofce tenant group in the region was the Banking, Finance,
Insurance (Fire) sector during 3Q 2014.
Te sub-index reached an all-time high since the survey
commenced in 1Q 2012, with most brokers expecting ofce
rentals to increase over the next 12 months.
Despite the sub-index picking up for three straight quarters,
the sub-index stayed below the 50.0% mark with most
landlords intending to ofer the same level of leasing
incentives in 3Q 2014.
72.2%
67.0%
75.5%
73.0%
64.4%
61.5%
67.6%
57.7%
69.1%
78.2%
78.9%
51.1%
60.4%
41.5%
63.7%
40.1%
70.9%
46.3%
68.3%
44.4%
54.0%
40.5%
55.7%
34.8%
58.2%
38.5%
68.0%
70.4%
42.8%
49.0%
54.4%
51.4%
49.1%
67.2%
53.3%
41.5%
51.0%
57.7%
63.6%
67.0%
Authors:
Simon Lo
Executive Director | Asia
+852 2822 0511
simon.lo@colliers.com
Jessy Chung
Analyst
+852 2822 0643
jessy.chung@colliers.com
Copyright 2014 Colliers International.
The information contained herein has been obtained from sources deemed reliable. While every
reasonable efort has been made to ensure its accuracy, we cannot guarantee it. No responsibility is
assumed for any inaccuracies. Readers are encouraged to consult their professional advisors prior
to acting on any of the material contained in this report.
Company Licence No.: C-006052
485 ofces in
63 countries on
6 continents
billion in
annual revenue
billion square feet
under management
professionals
and staf
$2.1 1.46 15,800
United States: 146
Canada: 44
Latin America: 25
Asia: 38
ANZ: 148
EMEA: 84
ASIA
Chris Cuf
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NORTH ASIA
Mainland China
Beijing
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Michael Wu
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Alex Xi
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Hong Kong
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(E-141423)
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(E-197789)
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Indonesia
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*Based in Singapore
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Yangon
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India
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Bengaluru
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Mumbai
George McKay
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george.mckay@colliers.com
New Delhi
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vikas.kalia@colliers.com
Pune
Rishav Vij
+91 20 4120 6438
rishav.vij@colliers.com
Pakistan
Karachi, Lahore, Islamabad
S. Fazal Ahmad
+92 21 3561 2550 2
fazal.ahmad@colliers.com
Kazakhstan
Almaty
Bayan Kuatova
+7 727 311 54 43
bayan.kuatova@colliers.com
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