sydney office market

According to the JLL Global Office Index, net effective rents rose in half of all markets in Q3; however, rental growth slowed modestly to 0.5% (+0.8%in Q2) as rental increases in larger markets such as Tokyo (+0.2%) eased. Domestic financial institutions and tech firms continued to be the main drivers of demand for prime space across the region.

Sydney (+3.9%) and Hong Kong (+3.5%) registered the strongest quarterly uplifts, followed by Shanghai (+2.4%), Beijing (+1.9%) and Bangalore (+1.9%). Several other markets recorded modest rises (1.0-1.5%) including Auckland, Mumbai, Chennai and Osaka.

Rents fell furthest (by 3.5%-5.5% quarter-on-quarter) in Singapore, Ho Chi Minh City and Perth, where recent or upcoming completions have created tenant-favourable conditions and put downward pressure on rents. In other markets, rents were mostly flat or changed fractionally.

Over the 12 months to Q3 2015, the Asia Pacific Office Index grew by 2.1% (versus 2.3% for Q2 2015).

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