Asia Pacific Office Outlook 2024

SHENZHEN

K E Y M E S S AG E S

SUPPLY

DEMAND

RENTS

KEY OUTLOOK

 The pre-leasing activities of the new projects contributed largely to the net absorption of 2023, a big jump from 2022.  While completions continue to enter the market, soft demand is likely to remain in 2024. The vacancy rate will continue to trend upward and the tenant favorable market pattern will persist. headquarter buildings will contribute to net absorption supported by owner - occupation. The demand is anticipated to gradually recover in 2025 as economic conditions recover.  The completion of

 Approximately 1.09 million sqm of new office supply is slated to enter Shenzhen's Grade A office market in 2023.  The market will see peaks with around 1.3 million sqm of new supply completing in both 2025 and 2026. The supply influx is set to maintain market pressure.  Some landlords are believed to have adjusted their leasing strategies and postponed project launch timelines in response to the uncertain economic environment.

 Amid sluggish demand and high supply pressure, landlords generally trimmed rents further in 2023, resulting in a deep fall in citywide average rents.  The downward trend in rents is expected to continue but with a softer decline starting from 2024.  As Grade A office rental costs continue to slide, it is expected that the flight to

 The international and

domestic environments remain uncertain, causing the office demand side to remain generally cautious.  The oversupply of Grade A office space in Shenzhen is expected to continue in the next few years. The reinvigoration of leasing demand largely depends on improvements in the economic outlook.

quality by tenants will become more common.