Beijing, March 31, 2022 /PRNewswire/ -- Colliers International (NASDAQ: CIGI; Toronto Stock Exchange Trading Code: CIGI), the world's leading diversified professional service and investment management company, held the "Technology Empowers the Future of 'Carbon' -- Colliers International North China First Quarter Press Conference" at China Overseas Real Estate Plaza in Beijing. Against the backdrop of "Technology + Dual Carbon", the conference invited well-known organization Foster + Partners to share online themes on "Future Smart Low-Carbon City". At the same time, the performance of various business segments of commercial real estate in North China in the first quarter of 2022 was reviewed and the outlook for the second quarter was made.
As of the first quarter of 2022, the market net absorption was about 102,000 square meters, basically returning to the level in 2019. Only one new project located in Yansha Market entered the market this quarter, bringing new supply of 65,000 square meters. The overall market has sold slightly, with the vacancy rate slightly falling by 0.1 percentage point month-on-month to 14.9%. Rents continued to fluctuate at the bottom, rising slightly by 0.4% month-on-month to 342 yuan per square meter per month, and achieved positive month-on-month growth again after the third quarter of last year. The trend of rent stabilization and recovery is strengthening. In terms of the sub-market of
, CBD and Lize performed actively, with net absorption of 48,000 and 47,000 square meters respectively in the quarter. Li Juan, senior director of the Strategic Customer Service Department of Coli International North China, believes that "with the full completion of Metro Line 14, the biggest stubborn problem on the development path of Lize Market has been eradicated, and the market competitiveness has been further improved. Due to the extremely competitive rental cost-effectiveness, Lize will still become one of the hottest sub-markets this year." CBD benefited from the strong expansion of leading financial groups and affiliated enterprises in the region in the China Service plot, and the vacancy rate has dropped to 9.8%. The market is shifting from the tenant market to the owner market. The new projects of China Service Plot have been launched on a large scale since 2019. After three years, the current average vacancy rate of projects has been lower than 20%. in terms of rent . Among the nearly 40 Grade A office buildings in CBD this quarter, nearly half of the buildings experienced rent increases to varying degrees, and only 3 buildings showed slight declines. The average rent of the sub-market increased by 1.5% month-on-month to 361 yuan per square meter per month. CBD has increased rent by more than 1% for two consecutive quarters, and the last time it saw two consecutive quarters of increase dates back to 2017.
Starting from the second quarter of 2021, Colliers International has shown that the retaliatory rebound of overall market demand is unsustainable, the net absorption will gradually return to normal, and rents will rebound by the end of 2021 or the first quarter of this year. At present, the data for the first quarter of 2022 have confirmed the previous judgment, and the market environment has also undergone new changes in recent months. " First, the four-year high supply period has ended. From 2018 to 2021, the average annual new supply in the market is close to 800,000 square meters, and the supply this year will be significantly reduced. The market supply and demand ratio has fallen sharply after hitting its high in 2020, and will remain at a low level in the future. Secondly, the demand for nearly 1.2 million square meters in in 2021 is destined to be a milestone event in the Beijing office market. market participants need to avoid inertial thinking, calmly judge the new changes that will appear in 2022, and actively respond to the market trends in the new era. Finally, the sales cycle has begun and will last for at least 3-4 years. , the intensity of the demand side will determine the future market trend. The emergence of the epidemic has advanced to a certain extent the time for the start of the sales cycle. "Chen Nan, deputy managing director of the North China District of Colliers International, said, "Hitml3 has entered the sales cycle since 2021, and the subsequent trend depends on the strength of the demand side. The overall environment may be more conducive to the owners, and the time window for corporate tenants to buy at the bottom will become shorter and shorter."
Beijing Grade A office market supply and demand ratio, 2002-2024F
This quarter, the biggest change in the Beijing office market came from the industrial park market, and these changes are mainly concentrated on the demand side of the industry . Judging from the market data , the industrial park market was basically stable in the first quarter, with the overall vacancy rate remaining at 14.6%, and the rent was stable at 130 yuan per square meter per month. The sudden end of the expansion of leading Internet companies has led to the failure of market sales. Grade A office market thanks to the turning point of financial companies in this quarter to achieve historical average sales. Industrial Park Market has long benefited from the expansion of Internet companies. Once Internet technology companies experience industry adjustments, it will significantly affect the growth rate of demand in the industrial park market. Judging from the leasing transactions in the entire market this quarter, the financial industry accounted for 37%, while the proportion of Internet technology dropped sharply to about 22%. Compared with the transaction proportion of more than 50% in the previous quarter, the expansion rate of the Internet industry in this quarter has slowed down significantly, mainly due to the government's continuous increase in regulatory policies on the Internet industry. Yan Quhai, managing director of North China, Colliers International, believes that "the policy environment of the Internet industry has undergone fundamental changes. The long-term "free-stocking" policy environment for the Internet has shifted to targeted compliance supervision based on the principles of anti-monopoly, anti-unfair competition and preventing disorderly expansion of capital. 2021 is not only the year of comprehensive deepening of Internet supervision, but also means that the Internet industry has begun to bid farewell to wild growth and enter a new stage of technological innovation and development with meticulous cultivation."
In the first quarter of 2021, the proportion of the leasing transaction industry, the full commercial and office market
Based on the new market environment, Colliers International believes that market participants need to focus on the following three important trends: first, deeply understand the original intention of the policy, and healthy development can move forward steadily. Although has been increasing its Internet regulatory policies recently and are mainly concentrated in leading platform economy enterprises, in the future, with the red and green lights of development set for the policies, the industry will usher in a more stable and healthy development stage. Second, it is the past to dominate one's family, and the future is the blooming of a hundred flowers. The development of China's digital economy requires the Internet industry to continuously nurture new era enterprises. From the meta universe to the east and west, a greater development space will create more market opportunities for enterprises. Internet software and service companies in the second and third echelons, and Internet hardware and equipment companies represented by chips and integrated circuits will benefit even more. Third, the Internet industry may experience large-scale area adjustments in the future. On the one hand, the internal adjustments of Internet companies are very fast, and recent adjustments to business, personnel and organizational structures will bring about changes in the office rental area; on the other hand, the top large factories sold nearly one million square meters of rental area last year, and there is a potential demand for office space integration this year. Yan Quhai, managing director of North China, Colliers International, said, ", office buildings represented by the Internet technology industry, is undergoing profound changes, which will greatly affect the overall office building market demand level in 2022. In addition, with the State Council officially issued the 14th Five-Year Plan for Digital Economy Development in early 2022, the problem of unbalanced, insufficient and irregular industry development is expected to be gradually solved in the future. Digital economy enterprises represented by Internet technology will still be the main source of demand in the office building market in the next five years."
About Colliers International
Colliers International (Nasdaq and Toronto Stock Exchange: CIGI) is a leading diversified professional service and investment management company. With an operational network established in 65 countries, more than 18,000 enterprising professionals work closely together to provide expert advice to real estate users, owners and investors. Over the past 25 years, our senior leadership team (significant internal shareholding ratio) has brought shareholders a compound annual return on investment of approximately 20%. With an annualized revenue of US$3.6 billion (including US$4 billion for subsidiaries), and a total asset managed by US$46 billion, we are able to maximize the potential of our property and accelerate the success of our customers and employees.
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