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| | | | | | | Office rents in Singapore raced ahead of cities in the Asia Pacific region in the second quarter, climbing 44 percent from last year.
They were buoyed by a lack of supply and outstripped the 40 percent increase seen in Manila's Makati financial district and Hong Kong.
Commercial property prices in the Asia Pacific region are climbing, with Singapore in the lead.
Office rents in Singapore picked up a hefty 44 percent on-year in the three months to June.
In its latest Asia Pacific Property Digest, Jones Lang LaSalle says the boom is due to strong tenant demand on the back of robust economic growth.
The report says coupled with the lack of new supply, office rents in some markets such as Bangkok, Kuala Lumpur, Manila and Jakarta are now close to their all-time highs.
Demand was broad-based, led by the banking and finance sectors, followed by professional services such as accounting and law firms.
There were also substantive gains in capital values.
Mumbai led by pack with a 40 percent on year rise, followed by Manila's Makati financial district.
Singapore was in third place with a 24 percent rise in the capital appreciation of its office blocks.
Jones Lang LaSalle expects the real estate market in the region to stay robust in the second half of the year.
With new quality supply remaining tight and demand strengthening, the property consultant believes rents should increase further.
However, businesses are feeling the pinch of the rising occupancy costs and this is likely to drive the trend for companies to decentralise their operations.
The strong performance in the office market is reflected in the industrial, retail and residential sectors.
Improving employment prospects are expected to outweigh the spectre of a higher interest rate environment.
The retail sector in particular has been benefiting from growing consumer confidence and the surge in tourist arrivals in the region. - CNA/ch
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