ASIA PACIFIC OUTLOOK 2025

ASIA PACIFIC

2025

OFFICE OUTLOOK 2025

Australia

ADELAIDE

MELBOURNE

SYDNEY

BRISBANE

PERTH

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

ADELAIDE

KEY MESSAGES

Supply

Demand

Rents

Key Outlook

The Market Square development, coupled with the ongoing demand for quality office spaces

Limited new supply is expected in the Adelaide CBD market in 2025, following the completion of just 10,000 sqm in 2024. A larger addition of 55,000 sqm is projected for 2027, but most projects are in early stages and could face delays due to high construction costs and low market demand.

Demand in the Adelaide CBD has been cyclical in recent years, with notable fluctuations.

Prime gross effective rents rose by over 10% in 2023, primarily due to a sharp increase in face rents.

and limited new supply, is expected to support office

growth in Adelaide CBD. As the flight-to-quality trend continues, secondary-grade and older prime-grade buildings may present opportunities for upgrades and redevelopment.

Prime net absorption rebounded to 23,700 sqm in 2023 and is expected to continue at 22,000 sqm in 2024.

Growth is expected to slow to 5% in 2025, as limited new supply restricts further quality-driven increases in face rents.

Over the next five years, demand is projected to remain modest, with net absorption ranging from 13,000 sqm to 19,000 sqm.

The Adelaide office market’s fundamentals remain modest, with gross effective rent growth projected to average above 2.5% annually from 2026 to 2028.

Beyond 2027, the timing of future projects remains uncertain.

Vacancy rates are also anticipated to stay steady, between 17% and 21%, due to limited new supply.

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

ADELAIDE

NEW SUPPLY

Adelaide experienced significant supply additions in 2023 with the completion of major projects such as 60 King William and Festival Tower, adding more than 90,000sqm prime grade space into market.

- 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000

FORECAST

The only major project to recently complete in 2024 was One Fifty at 150 Grenfell Street, providing 9,485 sqm of A grade space.

The 21,000 sqm development at 42-56 Franklin Street is currently under construction with delivery expected towards the first half of 2025. Approximately 55,000 sqm of prime space is expected to be added in 2027, though most projects remain in the planning stage.

NEW SUPPLY (SQM)

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

ADELAIDE

DEMAND & VACANCY

Net absorption turned negative in 2022 after strong gains the previous year.

35.0%

25,000

FORECAST

Demand rebounded in 2023, reaching 23,700 sqm, and is projected to remain positive at around 22,000 sqm in 2024. Modest growth is expected in the near term, with net absorption of approximately 18,000 sqm in 2025 and 13,000 sqm in 2026.

30.0%

20,000

25.0%

15,000

20.0%

10,000

15.0%

5,000

10.0%

Vacancy is expected to remain between 17% and 21% over the next five years.

-

5.0%

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

NET ABSORPTION (SQM) AND VACANCY RATE (%)

-5,000

0.0%

Net Absorption

Vacancy Rate

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

ADELAIDE

RENT GROWTH

Prime gross effective rents grew by 16% in 2023, driven by limited new supply, a strong labour market, and inflationary pressures on face rents. Rent growth is expected to moderate to 5.1% in 2024, reaching AUD 480/sqm per year, as vacancy remains steady with limited new supply. Between 2025 and 2027, rent growth is forecast to exceed 2%, as demand softens and the labour market slows..

0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0%

600

FORECAST

500

400

300

200

100

0

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

AUD/SQM/YR

Rent growth (%)

RENT (AUD/SQM/YR) AND RENT GROWTH (% PER ANNUM)

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

BRISBANE

KEY MESSAGES

Supply

Demand

Rents

Key Outlook

The redevelopment of the Eagle Street area, together with the ongoing flight to quality, will reinforce the “Golden Triangle” as the destination precinct within Brisbane’s CBD, bringing together high-quality office buildings with amenity and transport infrastructure.

In 2025, Brisbane CBD is set to receive 89,000 sqm of new supply in the second half of the year, following a two-year drought. Beyond 2025, only one project is expected to be completed in 2028, delivering 81,500 sqm with 38% pre committed.

The Brisbane CBD experienced three years of strong prime net absorption from 2022 to 2024, averaging 59,000 sqm per year.

Prime gross effective rents rose by over 16% in 2024, driven primarily by strong demand and rising face rents.

As demand eases, more modest growth is expected in 2025 and 2026 before the market rebounds in 2027.

Rental growth is expected to moderate to 4% in 2025 as new supply entering the market tempers face rent increases.

Steady demand and limited supply are anticipated to keep vacancy low, reaching 8% in 2027.

Supported by strong fundamentals, the Brisbane office market is expected to remain resilient over the long term, with gross effective rent growth averaging above 3% between 2027 and 2029.

Further afield, the likelihood of other projects proceeding as scheduled remains uncertain.

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

BRISBANE

NEW SUPPLY

The only major project to recently complete was in 2022 (Heritage Lanes at 80 Ann Street) providing 60,000 sqm of premium grade space. The 45,000 sqm development at 205 North Quay has been fully pre committed and is currently under construction with delivery expected towards the end of 2025.

- 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000

FORECAST

45,000 sqm at 360 Queen Street is now expected to be delivered in Q4 2025.

NEW SUPPLY (SQM)

Construction has begun on Dexus’s Waterfront Brisbane, with completion expected 2028.

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

BRISBANE

DEMAND & VACANCY

Office demand remains strong but has declined for three consecutive years, from 63,000 sqm of net absorption in 2022 to 58,000 sqm in 2024. Robust interstate migration has boosted short-term employment forecasts for Brisbane CBD, though this trend is expected to ease in 2025. Consequently, net absorption is projected to remain modest, reaching 14,000 sqm in 2025 and 20,000 sqm in 2026.

70,000

16.0%

FORECAST

14.0%

60,000

12.0%

50,000

10.0%

40,000

8.0%

30,000

6.0%

20,000

4.0%

10,000

2.0%

-

0.0%

Limited new supply will help maintain low vacancy rates, ranging between 8% and 12%.

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

NET ABSORPTION (SQM) AND VACANCY RATE (%)

Net Absorption

Vacancy Rate

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

BRISBANE

RENT GROWTH

Prime gross effective rents grew by 17% in 2024, driven by limited new supply, a strong labour market, and inflationary pressures on face rents. With significant new supply entering the market and a slowing labour market, rent growth is expected to moderate in 2025, increasing by 4% to reach AUD 640/sqm per year. This pattern is likely to continue through 2026 and 2027, with a rebound expected in 2028, delivering around 4% growth in prime gross effective rents.

0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0%

800

FORECAST

700

600

500

400

300

200

100

0

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

AUD/SQM/YR

Rent growth (%)

RENT (AUD/SQM/YR) AND RENT GROWTH (% PER ANNUM)

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

MELBOURNE

KEY MESSAGES

Supply

Demand

Rents

Key Outlook

The post-pandemic recovery has supported a cyclical upswing in tenant demand for Melbourne's CBD office market. Growth is expected to continue, and more limited supply in the near-term should support ongoing rental growth.

Following the delivery of nearly 121,000 sqm of prime office stock in 2022 and 2023, new supply in 2024 decreased to 94,000 sqm.

Despite slowing in 2023, net absorption returned to positive territory by the end of 2024.

Prime Melbourne CBD office rent growth has been slowing over the past two years due to elevated vacancy levels and supply in the market.

With new supply slowing, the market will have more time to absorb existing stock, supporting short-term demand.

Supply is anticipated to remain relatively subdued over the next two years, with

With supply easing and demand holding steady, 2024 marks a turning point as rent growth begins to recover.

104,000 sqm slated for completion in 2025 and 78,500 sqm in 2026.

Prime net absorption is projected to rebound and grow steadily through to 2029.

This recovery is expected to support near-term rental growth, with net effective rents projected to rise by over 5% by 2026 and 15% by 2028.

Beyond 2026, the pipeline is more limited, with a total of 142,000 sqm expected to be delivered between 2027 and 2029.

In this context, vacancy rates are expected to continue declining, stabilising at around 10% by 2029.

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

MELBOURNE

NEW SUPPLY

Supply in 2024 remains subdued, with 94,000 sqm of

new stock entering the market, compared to an

average of 121,000 sqm per year over the past two years.

140,000

FORECAST

120,000

The supply pipeline is expected to follow a

100,000

downward trend, with annual additions declining from the highs of 2022-2023. Future completions are forecast to average 70,000 sqm per year until 2028, reflecting the market's focus on absorbing existing stock.

80,000

60,000

40,000

NEW SUPPLY (SQM)

Completions are expected to rebound in 2029, with prime office projects delivering 42,000 sqm of new stock.

20,000

-

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

MELBOURNE

DEMAND & VACANCY

Prime net absorption is anticipated to rebound to positive territory in 2024, recovering from significant negative absorption in 2023,

10.0% 12.0% 14.0% 16.0% 18.0% 20.0%

100,000

FORECAST

though growth remains modest at 7,900 sqm.

80,000

60,000

As supply declines and the market steadily absorbs existing stock, net absorption is projected to improve gradually over the next five years, reaching 92,000 sqm by 2029. While new supply completions may limit reductions in vacancy, steady demand is anticipated to exert downward pressure on

40,000

20,000

0.0% 2.0% 4.0% 6.0% 8.0%

-

-20,000

-40,000

-60,000

vacancy rates in the foreseeable future.

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

NET ABSORPTION (SQM) AND VACANCY RATE (%)

Net Absorption

Vacancy Rate

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

MELBOURNE

RENT GROWTH

Net effective prime rents in the Melbourne CBD have been declining since 2022, though the decrease has been modest. Rent growth has remained limited, primarily driven by rising face rents, while prime incentives increased as the market absorbed existing stock. Rent growth is expected to reach its lowest point in 2024 as incentives stabilise, followed by a gradual upward trend. A strong labour market and steady demand are projected to support rental growth, with net effective rent growth anticipated to peak in 2028.

20.0%

600

FORECAST

15.0%

500

10.0%

400

5.0%

300

0.0%

200

-5.0%

100

-10.0%

0

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

AUD/SQM/YR

Rent growth (%)

RENT (AUD/SQM/YR) AND RENT GROWTH (% PER ANNUM)

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

PERTH

KEY MESSAGES

Supply

Demand

Rents

Key Outlook

The ongoing Elizabeth Quay development is poised to bolster Perth CBD's reputation as a prime office precinct, with enhanced amenities and transport infrastructure expected to support long-term growth in the office sector. Similarly, the successful urban renewal of the Perth City Link will revitalise the CBD, positioning it as a key market within Australia and the Asia-Pacific region, while contributing to the recovery and long-term stability of the office market.

After the addition of nearly 106,000 sqm of prime office stock in 2023, new supply in 2024 dropped significantly to 66,000 sqm.

After a sharp increase in net absorption to 54,000 sqm in 2023, it slowed significantly to 5,400 sqm in 2024.

Prime Perth CBD office rents continue to trend downward as high vacancy levels and inflation exert upward pressure on face rents.

As the market adjusts to normalisation, demand is

This subdued trend is expected to persist in 2025, with only 33,500 sqm of stock scheduled for completion.

Incentives are expected to remain elevated due to significant supply and modest yet steady demand.

expected to remain modest yet steady over the next five years.

This combination will constrain rent growth in the near term, with only minimal increases anticipated.

With no new supply anticipated beyond 2025 and consistent demand gradually absorbing existing stock, vacancy rates are projected to decline steadily, stabilising around 13% by 2029.

Beyond 2025, the pipeline for new projects is effectively empty, barring the approval of future developments.

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

PERTH

NEW SUPPLY

2024 has been relatively quiet compared to 2023, which saw an addition of 106,000 sqm of new stock. With projects delayed or withdrawn to allow the market to absorb existing supply, completions in 2024 were limited to just 66,000 sqm.

120,000

FORECAST

100,000

80,000

Similarly, 2025 is expected to remain subdued, with only 33,500 sqm scheduled for delivery.

60,000

40,000

Beyond 2025, the market faces a supply drought, as no new pipeline projects are currently planned until 2030.

NEW SUPPLY (SQM)

20,000

-

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

PERTH

DEMAND & VACANCY

A resilient labour market in Perth drove strong net absorption in 2023, reaching 54,000 sqm.

0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0%

60,000

FORECAST

Following this surge, net absorption in 2024 has softened as the market adjusts to normalisation and is expected to remain modest over the next five years. New completions in 2025 are expected to temporarily raise vacancy rates, which are projected to decline gradually over the next five years as no new supply is

50,000

40,000

30,000

20,000

10,000

added and the market absorbs existing stock.

-

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

NET ABSORPTION (SQM) AND VACANCY RATE (%)

Net Absorption

Vacancy Rate

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

PERTH

RENT GROWTH

Net effective prime rents in the Perth CBD have been declining since 2022, with a significant drop in 2023 driven by a surge in new supply. In 2024, net effective rents fell to 2.5%, down from 2.9% in 2023. High incentives and stable face rents are expected to limit rent growth as the market continues to absorb the surge in supply from 2020 to 2023. On a positive note, with no new supply planned for the next five years, rent growth is expected to stabilise, albeit minimally, ranging between -1% and 1%.

370

6.0%

FORECAST

5.0%

365

4.0%

360

3.0%

355

2.0%

350

1.0%

345

0.0%

340

-1.0%

-2.0%

335

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

AUD/SQM/YR

Rent growth (%)

RENT (AUD/SQM/YR) AND RENT GROWTH (% PER ANNUM)

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

SYDNEY

KEY MESSAGES

Supply

Demand

Rents

Key Outlook

The resilient labour market has supported the recovery of the Sydney CBD office market, positioning it to absorb the surge in supply in 2024. Limited supply after 2025 is expected to drive a gradual reduction in incentives and an acceleration in effective rent growth.

Following the delivery of over 175,000 sqm of new and refurbished prime office stock in 2022, 2024 saw an additional 177,000 sqm after a quieter 2023. Supply is expected to remain subdued in 2025, with 121,000 sqm anticipated as several major refurbishments near completion.

Prime office net absorption has returned to positive territory in 2024 after a decline in 2023. The

Sydney prime gross effective rent grew modestly in 2024, recording a 3.6% increase.

recovery was driven by an improving economy and a resilient labour market.

Face rent is expected to remain stable in 2025, with minimal fluctuations as incentives stabilise and steady market demand is supported by economic growth and a resilient labour market.

With supply remaining subdued in the coming years, net absorption is expected to grow steadily, reaching 80,000 sqm by 2029.

Beyond 2025, prime gross effective rental growth is projected to stabilise within the 6% to 8% range.

Between 2026 and 2029, net supply is projected to total just 200,000 sqm, averaging 50,000 sqm per year.

This steady demand will help stabilise the vacancy rate at around 16%.

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

SYDNEY

NEW SUPPLY

In 2024, the market saw an addition of 176,000 sqm of new office space, primarily from the completion of the North Tower and South Tower at Metro Martin, which are largely pre committed. Another notable contribution came from the 48,000 sqm Parkline Place. In 2025, an additional 121,000 sqm is expected, driven largely by major refurbishments in the City Core area. Beyond 2025, the supply pipeline is projected to remain modest, providing the market with time to absorb the influx of new office stock.

- 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 180,000 200,000

FORECAST

NEW SUPPLY (SQM)

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

SYDNEY

DEMAND & VACANCY

2024 marked a rebound in net absorption, reaching 30,000 sqm after recording negative absorption in 2023.

10.0% 12.0% 14.0% 16.0% 18.0% 20.0%

100,000

FORECAST

New completions in 2024 and 2025 are anticipated to temporarily increase vacancy rates. However, with subdued additions to supply, vacancy rates are expected to stabilise in the coming years, supported by steadily improving net absorption, projected to reach around 80,000 sqm by 2029. Resilient employment growth is projected to sustain steady demand for office space in the Sydney CBD.

80,000

60,000

40,000

20,000

0.0% 2.0% 4.0% 6.0% 8.0%

-

-20,000

-40,000

-60,000

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

NET ABSORPTION (SQM) AND VACANCY RATE (%)

Net Absorption

Vacancy Rate

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

SYDNEY

RENT GROWTH

Prime rental growth in Sydney CBD slowed to 3.6% in 2024, compared to 6.3% in 2023.

1,400

0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0%

FORECAST

The stabilisation of rent incentives has kept face rent growth modest, contributing to the overall slowdown.

1,200

1,000

800

This trend is expected to continue through 2025, with limited changes in market dynamics.

600

400

Rental growth is anticipated to recover in 2026, driven by steady demand and subdued supply, stabilising between 6% and 8% thereafter.

200

0

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

AUD/SQM/YR

Rent growth (%)

RENT (AUD/SQM/YR) AND RENT GROWTH (% PER ANNUM)

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

ASIA PACIFIC

2025

CONTACTS

ABOUT CUSHMAN & WAKEFIELD

Cushman & Wakefield (NYSE: CWK) is a leading global commercial real estate services firm for property owners and occupiers with approximately 52,000 employees in nearly 400 offices and 60 countries. In 2023, the firm reported revenue of $9.5 billion across its core services of property, facilities and project management, leasing, capital markets, and valuation and other services. It also receives numerous industry and business accolades for its award- winning culture and commitment to Diversity, Equity and Inclusion (DEI), sustainability and more. For additional information, visit www.cushmanwakefield.com. Copyright © 2024 Cushman & Wakefield. All rights reserved. The information contained within this report is gathered from multiple sources considered to be reliable. The information may contain errors or omissions and is presented without any warranty or representations to its accuracy.

RESEARCH SEAN ELLISON

TENANT REPRESENTATION MICHAEL KEARINS Head of Tenant Representation, Australia michael.kearins@cushwake.com

Head of Forecasting, Australia Sean.ellison@cushwake.com

LEASING TIM MOLCHANOFF Head of Leasing, Australia tim.molchanoff@cushwake.com ASIA PACIFIC Dr Dominic Brown Head International Research dominic.brown@cushwake.com

CAPITAL MARKETS JOSH CULLEN Head of Capital Markets, Australia josh.cullen@cushwake.com

OFFICE OUTLOOK 2025

Greater China

BEIJING

HONG KONG

SHENZHEN

GUANGZHOU

SHANGHAI

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

BEIJING

KEY MESSAGES

Supply

Demand

Rents

Key Outlook

Compared with other first - tier cities, Beijing’s future supply is limited, with a supply-to-stock ratio of only 13%.

Beijing’s office market will continue to face headwinds, with net absorption expected to be at around 300,000 sq m in 2025.

Rents have been under pressure in 2024. By Q3 2024, the overall market rentallevel reached RMB266.11 per sq m, down 13.5% y-o-y.

From 2025 to 2029, the Beijing office market is expected to welcome approximately 1.54 million sq m of new office space. Of this total, the future supply in the five core submarkets and suburban submarkets will account for 42.2% and 57.8% of the city’s total future supply, respectively.

Companies in the digital economy, the telecoms sector, the healthcare services sector and the financial services sector are set to be the main sources for office leasing demand in the city. The downward trend in rents is expected to continue. We expect that many tenants will look to upgrade from Grade B office space to Grade A office space during 2025.

New project entries into the market will continue to drive up the overall vacancy rate. As a result, the vacancy rate is expected to peak at around 20% in 2027.

Cost control will remain the chief tenant leasing strategy. In 2025, overall rental levels may continue to face a downward trend.

Approximately 270,000 sq m of new office supply is slated to enter Beijing's Grade A office market in 2025.

With an expected stronger economic environment and corporate performance, the citywide average rental levels are expected to stabilize in 2026.

The market will remain tenant - favourable for the next few years, with domestic firms continuing to lead the leasing market.

The market will see peak new supply completing in both 2026 and 2027.

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

BEIJING

NEW SUPPLY

Ahead, 1.54 million sq m of new supply is now scheduled to enter the market by the end of 2029, of which 270,000 sq m will complete in 2025. Many projects have been delayed due to the impact of the economic downturn. In turn, the new supply peak has been pushed back to 2027.

700,000

FORECAST

600,000

500,000

400,000

300,000

200,000

NEW SUPPLY (SQM)

100,000

0

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

BEIJING

DEMAND & VACANCY

Buffeted by economic uncertainty, net absorption continued to weaken in 2024. We expect that pre-leasing from new entrants and large area transactions will boost net absorption to 280,000 sq m citywide by the end of 2024. The TMT, finance, and professional services sectors will continue to be the major drivers of leasing demand into the future. In terms of transaction type, renewals will dominate leasing activity in 2025. However, in the longer term, demand for office space in Beijing is expected to pick up gradually as the economy and corporate business efficiencies improve.

100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000

25.0%

FORECAST

20.0%

15.0%

10.0%

5.0%

0 50,000

0.0%

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

NET ABSORPTION (SQM) AND VACANCY RATE (%)

Net Absorption

Vacancy Rate

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

BEIJING

RENT GROWTH

In 2025, tenant cost reductions and improving business efficiencies, together with landlords' rent reductions to spur occupancy, will continue to be the main strategic themes for tenants and landlords. As a result, the overall average market rental level will continue to trend down next year. However, with a gradual recovery of the economy and overall market activity in 2025, we expect that office rents will stabilize or enter a turning point in the middle of 2026.

350

0.0% 2.0% 4.0%

FORECAST

300

250

-14.0% -12.0% -10.0% -8.0% -6.0% -4.0% -2.0%

200

150

100

50

0

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

RMB/SQM/MO

Rent growth (%)

RENT (RMB/SQM/MO) AND RENT GROWTH (% PER ANNUM)

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

GUANGZHOU

KEY MESSAGES

Supply

Demand

Rents

Key Outlook

In the next few years, the Guangzhou office market will see a peak in supply, which will exert greater pressure on the market. As the macroeconomic environment continues to improve, combined with strong policy support, the release of corporate demand for R&D, industrial and office properties will accelerate.

From 2025 to 2029, the Guangzhou office market is expected to add around 2.7 million sq m of new office space, with citywide stock set to reach 9.4 million sq m in 2029.

Net absorption is expected to peak at around 400,000 sq m in 2026, as the large volume of new supply will stimulate market demand.

Pressured by the uncertain external environment and high supply, landlords will adopt price for-volume leasing strategies. In the short term, the overall rental level will continue to decline. With an expected clearer economic environment and a slowdown in supply, the rate of rental level decline is expected to gradually narrow, and rents may return to positive growth in 2027.

The continued influx of new supply will keep the city's vacancy rate high in the coming years.

Peak new supply is expected in 2026, when more than 860,000 sq m of new space will enter the market.

The market will remain tenant - favourable for the next few years, and landlords will adopt flexible leasing strategies to help stabilize occupancy rates.

The continued entry of a large volume of new supply will intensify market competition and reshape the Grade A office market.

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

GUANGZHOU

NEW SUPPLY (SQM)

Due to the delayed completion of some projects, the Guangzhou Grade A office market is expected to see only 172,659 sq m of new supply complete in 2024, less than half of the average supply seen over the previous three years. Over the next five years, the market will see around 2.7 million sq m of new supply, which is expected to peak at around 860,000 sq m in 2026. The supply influx will be mainly concentrated in Pazhou and the International Financial City districts, two emerging business submarkets, which will accelerate the formation of a new development pattern in the Guangzhou office market

- 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 900,000 1,000,000

FORECAST

NEW SUPPLY (SQM)

The continued high supply is set to maintain market pressure.

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

GUANGZHOU

DEMAND & VACANCY

As corporate leasing strategies remain conservative, net absorption is expected to be at less than 200,000 sq m in 2024. Leasing demand is expected to recover and peak at approximately 400,000 sq m in 2026 on the back of favourable policies and the upgrading of the industrial structure. The professional services and TMT industries will remain the key sectors for leasing demand into the future. The high supply volume will stimulate demand,although we can also expect the overall vacancy rate in the city to remain high.

30.0%

-50,000 0 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000

FORECAST

25.0%

20.0%

15.0%

10.0%

5.0%

0.0%

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

NET ABSORPTION (SQM) AND VACANCY RATE (%)

Net Absorption

Vacancy Rate

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

GUANGZHOU

RENT GROWTH

The release of new supply in emerging submarkets is expected to exert downward pressure on rental levels. Subsequently, landlords will continue their price-for-volume leasing strategy. By 2026, the citywide average rental level is likely to drop to RMB120 per sq m per month.

100 120 140 160 180

4.0%

FORECAST

2.0%

0.0%

-2.0%

As the economic environment becomes

-4.0%

0 20 40 60 80

clearer and the office supply peak ends, rent growth will gradually pick-up and return to positive growth by 2027.

-6.0%

-8.0%

-10.0%

-12.0%

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

RMB/SQM/MO

Rent growth (%)

RENT (RMB/SQM/MO) AND RENT GROWTH (% PER ANNUM)

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

HONG KONG

KEY MESSAGES

Supply

Demand

Rents

Key Outlook

Looking ahead, we expect that demand from the banking & finance and professional services sectors may gradually recover if the recent IPO performance can sustain through the coming months. Landlords are expected to remain flexible and to offer incentives to compete for tenants amidst the current market conditions.

New supply of more than 3.5 million sq ft will enter the city's market in 2025, with Greater Tsim Sha Tsui accounting for the greatest share at 2.1 million sq ft. However, most of the major new supply will be concentrated in H2 2025 period, suggesting that the market will remain stable in the next 6–9 months. In the longer term, new supply will gradually taper off, with just 1.5 million sq ft due in 2026–2027, before a haltin new completions in 2028– 2029.

Hong Kong’s office market registered a fourth consecutive quarter of positive net absorption in Q3 2024. We expect take-up will remain stable through 2024. With no major new supply of more than 200,000 sq ft entering the market in the next 6–9 months, we expect the overall availability rate to remain stable in the 1H 2025 period. Occupiers are likely to continue to search for flight-to-quality options in the market, with landlords also more willing to consider upgrades to their properties.

Although we are seeing a recovery in overall office space absorption, ample supply will continue to affect the rental level trend. We expect the overall Grade A office rental level to decline by 7% in 2024, followed by a further 8% drop in 2025. The current rental level is approximately 40% down from the peak seen in January 2019. We expect that by the end of 2024, the overall rental level will be at HKD44.6 per sq ft per month, before bottoming out in 2027 at HKD39.0 per sq ft per month.

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

HONG KONG

NEW SUPPLY

Seven new projects are expected to enter in 2025, totaling 3.5 million sq ft. This is higher than the 5-year average supply due from 2024 to 2028, at 1.3 million sq ft per annum. Core districts will be the major source new supply in 2025. A sizable project in Greater Tsim Sha Tsui will account for 60%, or 2.1 million sq ft, of the new stock. However, beyond 2025, new supply will gradually taper off with approximately just 1.5 million sq ft between 2026 and 2029, and this will send a positive signal to the market.

4.0

FORECAST

3.5

3.0

2.5

2.0

1.5

1.0

NEW SUPPLY (MSF)

0.5

0.0

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

HONG KONG

DEMAND & VACANCY

The Grade A office market registered a fourth consecutive quarter of positive net absorption in Q3 2024. Leasing activities predominantly focused on relocations driven by occupier cost saving, with other moves involving flight-to-quality incentives. Despite the positive take -up momentum, the overall availability rate continued to stay at a high level due to the elevated supply. We expect that the availability rate will reach a peak in H2 2025, before gradually moving down amid declining new supply and stable absorption.

25.0%

1.2

FORECAST

1.0

20.0%

0.8

0.6

15.0%

0.4

10.0%

0.2

0.0

5.0%

-0.2

-0.4

0.0%

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

NET ABSORPTION (MSF) AND VACANCY RATE (%)

Net Absorption

Vacancy Rate

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

HONG KONG

RENT GROWTH

We expect that the rental correction will continue in the 2024–2027 period, with a more notable correction of 7% and 8% in 2024 and 2025, respectively. We expect the overall rental level will be at HKD39.0 per sq ft per month at the end of 2027. The current rental level is at approximately 40% down from the peak seen in January 2019, and such a discount provide opportunities for occupiers for flight-to-quality moves. We expect this trend is likely to continue in 2025.

6.0%

60.0

FORECAST

4.0%

50.0

2.0%

40.0

0.0%

-2.0%

30.0

-4.0%

20.0

-6.0%

10.0

-8.0%

-10.0%

0.0

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

HKD/SQFT/MO

Rent growth (%)

RENT (HKD/SF/MO) AND RENT GROWTH (% PER ANNUM)

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

SHANGHAI

KEY MESSAGES

Supply

Demand

Rents

Key Outlook

Tenants will continue to focus on costs.

Approximately 0.9 million sq m of new supply is slated to enter the market in 2024, accounting for 59% of the supply peak seen in 2023 and 115% of the new supply seen in 2022. From 2025 to 2028, the Shanghai market is expected to see 3.7 million sq m of office space launched. During this period, some landlords may adjust their project launches according to market conditions, especially in the case of developers launching projects in phases.

The market will remain tenant - favourable in the foreseeable future. The large supply volume, coupled with the real economy struggling to pick up, means demand is expected to be insufficient to fill existing vacancy. The professional services, TMT, and retail & trade sectors will lead leasing market demand within the year, and domestic enterprises will continue to occupy the lion’s share of demand generation.

The leasing capacity of enterprises has declined over recent months, and in turn, landlords have further adjusted their leasing strategies. Ahead, rents are expected to drop by 7.4% to RMB222 per sq m per month by the end of 2024 and to further decline to RMB219 in 2025. Downward pressures on overall rental levels will remain in both suburban and core markets. However, into the short-term future, the rate of decline is expected to slow.

The easing policies introduced in succession since September this year will benefit the market, but tenant sentiment still needs time to change. With market conditions being more tenant-favourable, a proactive line of thinking related to an improvement in office building assets, such as fine tuning both hard and soft asset management services, has become vital to ensure office building market relevance.

Overall availability is forecasted to rise to 23.4% by the end of 2024 and to peak at around 27.6% by 2025.

Shanghai’s citywide office stock is expected to exceed the 20 million sq m mark in 2027.

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

SHANGHAI

NEW SUPPLY

Shanghai is expected to see an increase in office supply, with approximately 0.9 million sq m of new space slated for launch in 2024. This represents a sizeable portion of the peak new supply seen in 2023 (59%) and a meaningful increase over the supply seen in 2022 (115%). From 2025 to 2028, the market is expected to see the launch of an additional 3.7 million sq m of office space. However, some landlords may adjust their project launches based on market conditions, particularly in the case of developers launching projects in phases. By 2027, Shanghai's total office stock is projected to exceed 20 million sq m, indicating a continually expanding office market.

- 200,000 400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 1,600,000 1,800,000 2,000,000

FORECAST

NEW SUPPLY (SQM)

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

SHANGHAI

DEMAND & VACANCY

The Shanghai office market is expected to remain tenant friendly in the near future, with a significant supply surplus anticipated to keep vacancy rates high. The large volume of new supply, combined with a slow growing real economy, is expected to outpace demand. While professional services, technology, media, and telecommunications (TMT), and retail & trade sectors are expected to lead leasing demand in the coming year, domestic enterprises will continue to dominate demand generation. The availability rate is projected to rise to 23.4% by the end of 2024 and reach a peak of around 27.6% by 2025, reflecting the ongoing imbalance between supply and demand.

700,000

30.0%

FORECAST

600,000

25.0%

500,000

20.0%

400,000

15.0%

300,000

10.0%

200,000

5.0%

100,000

0.0%

0

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

NET ABSORPTION (SQM) AND VACANCY RATE (%)

Net Absorption

Vacancy Rate

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

SHANGHAI

RENT GROWTH

In response to a recent decline in enterprise leasing capacity, landlords in Shanghai's office market are adjusting their leasing strategies. This has led to a downward trend in rental rates, with rents expected to drop by 7.4% to RMB222 per sq m per month by the end of 2024 and further decline to RMB219 in 2025. While downward pressures on overall rents will continue in both suburban and core markets, the rate of decline is expected to slow in the near future.

-8.0% -7.0% -6.0% -5.0% -4.0% -3.0% -2.0% -1.0% 0.0% 1.0%

200 205 210 215 220 225 230 235 240 245 250

FORECAST

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

RMB/SQM/MO

Rent growth (%)

RENT (RMB/SQM/MO) AND RENT GROWTH (% PER ANNUM)

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

SHENZHEN

KEY MESSAGES

Supply

Demand

Rents

Key Outlook

The domestic economy is expected to recover gradually, but risks in the external environment still exist, and in turn it will take some time for office leasing demand to pick up. Ahead, it is foreseeable that lower rents, longer rent-free periods and customised fit-out services will be the preferred mechanisms employed by landlords to attract tenants in the coming few years.

Approximately280,000 sq m of new office supply is slated to enter Shenzhen's Grade A office market in 2024.

The delayed entry of new projects coupled with soft demand has resulted in weak growth in net absorption in 2024, less than half of that seen in 2023. China's economic stimulus package may contribute to the recovery of office leasing demand in 2025. In addition, with the completion of headquarters buildings, owner - occupation will bolster net absorption. However, the vacancy rate is expected to remain on an upward trend in the coming years as supply will still increase substantially.

Citywide average rents declined further in 2024, primarily driven by weak demand.

The downward trend in rents is expected to continue, with related leasing expenses also set to be adjusted under the pressure of vacancy.

Given the large volume of office space under construction, stock is expected to climb significantly to 9.5 million sq m in 2025. The market will see a peak in new supply with around 1.26 million sq m of new supply completing in 2026, pushing total stock to 10.71 million sq m.

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

SHENZHEN

NEW SUPPLY

Approximately 0.28 million sq m of new office supply is slated to enter Shenzhen's Grade A office market in 2024. Given that much of this year’s new supply of offices is yet to be put on the market, overall stock is expected to surge notably to reach 9.5 million sq m in 2025. New supply will peak in 2026 at around 1.26 million sq m, which is set to exert additional pressure on office landlords.

1,400,000

FORECAST

1,200,000

1,000,000

800,000

600,000

400,000

NEW SUPPLY (SQM)

200,000

-

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

SHENZHEN

DEMAND & VACANCY

Cumulative office market net absorption is forecast to drop to 140,000 sq m in 2024, less than half of that in 2023, mostly led by the delayed entry of new projects and soft demand. The estimated year end citywide vacancy rate will also be affected by these factors, slightly rising to 26.3%, up 0.2 percentage points y-o-y. China's economic stimulus measures may aid in the resurgence of office leasing demand in 2025. Furthermore, upon the completion of headquarters buildings, increased owner-occupation will elevate net absorption. Despite this, the vacancy rate is anticipated to continue its upward trajectory in the forthcoming years due to an estimated substantial increase in supply.

10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0%

600,000

FORECAST

500,000

400,000

300,000

200,000

100,000

0.0% 5.0%

0

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

NET ABSORPTION (SQM) AND VACANCY RATE (%)

Net Absorption

Vacancy Rate

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

SHENZHEN

RENT GROWTH

In 2024, citywide average rents dropped further, primarily due to subdued demand.

250

0.0%

FORECAST

Influenced by the pressure of high vacancy rates, the continuation of the downward trend in rents is likely to be seen in the future, coupled with adjustments to related leasing expenses.

-2.0%

200

-4.0%

150

-6.0%

100

In the coming years, attracting tenants is

-8.0%

expected to involve offering lower rents, extended rent free periods, and personalised fit-out services.

50

-10.0%

-12.0%

0

2022 2023 2024F 2025F 2026F 2027F 2028F 2029F

RMB/SQM/MO

Rent growth (%)

RENT (RMB/SQM/MO) AND RENT GROWTH (% PER ANNUM)

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

Source: Cushman & Wakefield

ASIA PACIFIC

2025

CONTACTS

ABOUT CUSHMAN & WAKEFIELD

Cushman & Wakefield (NYSE: CWK) is a leading global commercial real estate services firm for property owners and occupiers with approximately 52,000 employees in nearly 400 offices and 60 countries. In 2023, the firm reported revenue of $9.5 billion across its core services of property, facilities and project management, leasing, capital markets, and valuation and other services. It also receives numerous industry and business accolades for its award- winning culture and commitment to Diversity, Equity and Inclusion (DEI), sustainability and more. For additional information, visit www.cushmanwakefield.com. Copyright © 2024 Cushman & Wakefield. All rights reserved. The information contained within this report is gathered from multiple sources considered to be reliable. The information may contain errors or omissions and is presented without any warranty or representations to its accuracy.

RESEARCH SHAUN BRODIE Head of Research Content, Greater China shaun.fv.brodie@cushwake.com ROSANNA TANG Head of Research, Hong Kong rosanna.tang@cushwake.com ASIA PACIFIC DR DOMINIC BROWN Head of International Research dominic.brown@cushwake.com

CAPITAL MARKETS FRANCIS LI Head of Capital Markets, Greater China francis.cw.li@cushwake.com TENANT REPRESENTATION JONATHAN WEI President, Project & Occupier Services, China jonathan.cy.wei@cushwake.com JOHN SIU Managing Director, Hong Kong john.siu@cushwake.com

OFFICE OUTLOOK 2025

India

AHMEDABAD

CHENNAI

HYDERABAD

MUMBAI

BENGALURU

DELHI NCR

KOLKATA

PUNE

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025

AHMEDABAD

KEY MESSAGES

Supply

Demand

Rents

Key Outlook

The city is currently attracting major IT-BPM occupiers supported by the state government’s IT policy, SEZ benefits and talent pool availability.

A total of 2.6 msf of new supply is expected to enter the Ahmedabad office market across submarkets in 2025.

Net absorption in 2025 is expected to reach 1.35 msf. Demand momentum is expected to continue in 2026 and 2027 with an average of 1.4 msf of net absorption each year.

Rents are forecast to grow by ~2% between 2025 and 2026, backed by rising demand for quality office space in the city.

A further 2.0 msf is expected in 2026, followed by an average supply of 1.5 msf anticipated in the 2027–2029 period.

Rents will likely move to INR560 per sq ft per year by end-2025, and then to INR572 by end-2026.

Submarkets such as GIFT City and SBD have been attracting large occupiers.

Vacancy is expected to stay in the range of 30%–31% from 2025 through 2027.

The strong supply additions in 2025 and 2026 will be a driver for a rise in the vacancy level by ~1.5%.

Cushman & Wakefield

ASIA PACIFIC OUTLOOK 2025