[photopress:shanghai_offices.jpg,full,alignright]According to a recent report by Jones Lang LaSalle strong demand from tenants continued in almost all major sectors of the local property market in the year’s second quarter.
Office tenants in Pudong found that it was still a tight market and therefore landlords, in whose veins runs not the milk of human kindness, were asking high rents. International retailers began to tap thriving suburbs to expand their local stores and emerging logistics hubs have seen rents jump because of strong demand.
Rents in core CBDs — namely, Puxi from Xizang Road to Changshu Road, and Huaihai Road to Nanjing Road, plus Lujiazui east to Dongfang Road and south to Dongchang Road — continue to outpace the market average by about 10%. Core CBD rents jumped to RMB9.05 ($1.18) per square meter per day, compared to RMB6.50 in non-core areas.
Rental growth for buildings in Pudong was 8.7% up from the previous quarter, while that for the overall market was 5%.
Meanwhile, international investors flock to second-tier cities. By partnering with local developers, large investors such as ING Real Estate, Morgan Stanley, RREEF, Citigroup Property Investors, Merrill Lynch and GIC are tapping into development opportunities. Their local partners include Gemdale, Shimao, Greentown, Yanlord, and Forte Land. This strategy seems to be more attractive for international investors than buying existing properties.
None of these are signs of a boom under control nor yet of a property market bubble going pop. Not in the slightest.
Source: Shanghai Daily