The vacancy rate for Grade-A offices in Taipei last quarter rose 0.5 percentage points, while rents climbed to a record NT$3,279 per ping (3.3m2), as demand remained healthy, property consultancy REPro Knight Frank (瑞普萊坊) said on Tuesday.
Despite the uptick, the 6.4 percent vacancy rate during the April-to-June period is lower than the 20-year average and Taipei ranked the fourth-best performer in the Asia-Pacific region, after Seoul’s 1.5 percent, Tokyo’s 4.3 percent and Singapore’s 5 percent, the international broker said.
The uptrend in office rents is due to inflation and the growing importance corporations assign to modern office spaces that can help boost work efficiency and meet environmental friendliness and energy conservation requirements, it said.
Photo: Hsu Yi-ping, Taipei Times
A total of 55,000 ping of new office spaces would join the market in central business districts later this year, aided by the government’s efforts to facilitate urban renewal projects and retire old and dilapidated buildings, it said.
Developers have responded, taking advantage of favorable building terms and related business opportunities, it said.
Hospitality service providers lent support by shutting down old facilities during the COVID-19 pandemic and converting them into mixed-use complexes featuring residential and commercial spaces.
New high-end office buildings are near the Taipei Dome in the prime Xinyi District (信義), near Taipei Railway Station in Zhongzheng District (中正), across from the Howard Plaza Hotel Taipei (台北福華飯店) in Daan District (大安) and in Zhongshan District (中山).
Their entry would ease a supply crunch over the past few years that set off a relocation wave, REPro Knight Frank said.
Corporations have shown a preference for divisions to work in the same building as their headquarters to bolster communication and coordination, it said.
REPro Knight Frank said it is not worried about a supply glut as some buildings are intended for self-occupancy, such as a new complex owned by Yuanta Commercial Bank (元大銀行) near the Howard Hotel.
Furthermore, urban renewal projects account for several new office buildings, meaning the net gain in new offices is limited, it said.
In addition, the limited availability of land in Taipei and the lengthy complicated efforts for urban renewal projects would limit the entry of new office buildings and make the ones available attractive, it said.
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