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Investors looking for a safe investment environment amid uncertain economic and political conditions have kept global office rates tight.
The latest World Office Yield Spectrum report from Savills and Deakin University of Australia shows that the average decline in yields across 11 gate cities since December 2014 is 95 points basic.
San Francisco saw a significant drop (32%) from nearly 7% to 4.64%. Meanwhile, in Shanghai and West Los Angeles, the rates were down only 0.29% and 0.31%, respectively.
Of these major cities, Sydney was the most attractive, with 5.37%. Following are the western markets of Los Angeles and San Francisco, which are the only cities with a yield of over 4.50%.
Data from all 54 cities across Asia, Europe, America and Australia show that Hanoi is leading the new 8.75% yield. Followed by HCMC With 8.5% yield.
Taipei ranked at the bottom with the lowest office rate, nearly 2%; just above Hong Kong with 2.5%.
Tony Crabb, Head of Research at Savills in Australia, said that the office market, with the best of luck, is expected to continue to receive strong capital investment. In the context of economic and political uncertainty, this market is becoming a safe investment option and more attractive to investors.
“This is an interesting time in the investment cycle, as the market reacts to the form of inflation / growth trade by boosting bond yields and growth stocks ( growth stocks, and noted that the office market will perform well when demand increases, “said Crabb.
Mr. Crabb also said that with the current situation of most markets still exist the situation of economic and political instability, it can be said that office investment market will continue to bring good investment value, because This will attract more demand, and in some cases will reduce yields.
“Much of what is going to happen in 2017 and beyond will depend on the decisions of the US Federal Reserve on interest rates and policies that the new president will set.
“These factors, along with the Brexit talks and election activity in other large European countries, will be key factors in determining the fluctuations of currency, trade flows and capital movements. the world, “Crabb analyzed.
Savills’ director added that if there are any obstacles to investing in the office market, there will be a shortage of supply in most of the gate cities where the investment capital has been received. Very large, in some places at record levels, in recent years.
“The shortage of supply is exacerbated by the strength of the rental market, especially in the gateway cities, which reduces space, reduces rental rates and investors are happy to accept this reality. “
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