Markets to Watch
Shanghai, China — Normally a thriving office market, Shanghai office demand slowed in 3Q08 due to the global economic slump. With vacancies reaching 9.8 percent, prime rental rates stayed flat at 9.9 renminbi ($1.44) per square meters per day, reports Colliers International. Vacancy rate increases will challenge the overall rental performance through year-end.
London — The city’s West End district has been named Europe’s top retail destination, according to Experian, a European credit checking and information services provider. In fact, Experian estimates that London’s weighted consumer spending for 2008 totaled v6.2 billion ($7.8 billion).
Moscow — Overall, 2009 will be a gray year for Russia’s office market. However, despite a decrease in 2Q08, inventory in Moscow’s office market was 6.2 percent higher in 4Q08 than the same time last year at more than 365,000 sm, reports Cushman & Wakefield. The occupancy rate ended the quarter at 1.3 million sm, 240,000 sm behind 4Q07’s total. Moscow’s 4Q08 overall vacancy rate rose to 12.2 percent, the highest since 2001, with 5.9 million sm of speculative space delivered.
Singapore — The central business district’s office market average occupancy rate fell 1.5 percentage points to 96.9 percent in 3Q08, according to Colliers International. New leases in Singapore include BHP Billiton and Macquarie Group. Located in the Marina Bay Financial Centre Tower II, the companies signed 10-year leases for 142,000 sf and 78,000 sf respectively. Overall, prime office rental rates were expected to stay flat in 4Q08.
World’s First Eco-Resort Community
The northern-most tip of the Palawan Biosphere Reserve in the Philippines is the site planned for The Cacao Pearl, the world’s first nonprofit luxury eco-resort community. Located on a private island, the 124-acre development will include residential homes with no carbon cost, five-star service, a pool, reef diving, a secluded destination spa, organic gardens and bar, a restaurant, and private media rooms.
Spotlight on Turkey: The Industry’s Newest Gem
While Istanbul has developed into a strong real estate market, opportunities now are expanding to Turkey’s regional cities, which are benefiting from increased international openness and foreign direct investment inflows, according to Jones Lang LaSalle’s Turkish Statistical Institute, which identified 18 real estate hot spots. Despite the fact that the Turkish regions account for three-quarters of the country’s gross domestic product, their low numbers — only 60 percent of retail stock and nearly 20 percent of office stock — show that these regions are still largely untapped. Major regional cities such as Ankara, Izmir, Bursa, Antalya, and Kocaeli and several tertiary markets offer big opportunities in retail, office, industrial, residential, and hospitality.
European Historic and Projected Retail Sales Growth
Retail Sales Growth 1997–2007 (%)
Retail Sales Growth 2008–18 (%)
Source: Experian Business Strategies, King Sturge