Guangzhou
Guangzhou is the capital and the largest city of the Guangdong Province in southeastern China – located along the Pearl River, just eighty miles northwest of Hong Kong. Once a major trading terminus of the maritime Silk Road the city has continued its traditions and is now one of the world’s major ports and transportation points. The city’s main seaport is currently the sixth largest in the world. Guangzhou is a sub-provincial city and has direct jurisdiction over eleven districts, including Tianhe, Yuexiu, Haizhu and Liwan districts. With a population of around thirteen million and being situated along the heavily populated area of the Pearl River Delta means the city is one of China’s most important railway and aviation terminals. Guangzhou Station, along with the four other stations found in the Northern, Eastern, Southern and Western parts of the city, aligned with Guangzhou Baiyun International Airport support the flow of passengers from Guangzhou to the rest of China and the world. Currently there are nine metro lines in operation serving the city public transit, but the city hopes to expand to fifteen lines by 2020. References: JLL Guangzhou Property Market Review 2016 and Vision 2017
Tianhe
Haizhu
Yuexiu
Liwan
The most notable trend to come out of the Guangzhou office market in recent years is the rapid increase in Grade A office stock. Guangzhou possesses a number of commercial property projects, such as Guangzhou CTF Finance Center, Kingold Century, Laifung Tower, Poly Skyline Tower, Guangzhou International Finance Center, Central Tower, TaiKoo Hui Tower, International Finance Place, Yuexiu Financial Tower, Yuexiu Financial Tower and R&F Center. As of 4Q16, the majority of Grade A office stock was located in Zhujiang New Town. The banking and finance and professional service industries have led the annual net absorption to more than 550,000 sqm. Besides, some IT and communications companies have become the new growth of the superior office space. The majority of that demand has been driven by domestic companies. Just under half of total transactions have been associated with relocation from Grade A and expansion with the remainder of transactions made up of relocation from Grade B, new setups and renewals. In 2016, the new supply of Grade A office space reached a record high, with more than 750,000 sqm, and 70% of the new projects are located in Zhujiang New Town. The vacancy rate has had a late upward trend due to the influx of Grade A office completion but that is expected to stabilize in the coming quarters. Although a particularly large influx of new completed projects has lifted the vacancy rate, with the continuous rising of the pre-commitment rate of the quality buildings and the need of office space, the overall vacancy rate has come back to 11.9% after rising for a third consecutive quarter. Looking ahead, the GDP growth of Guangzhou in 2017 is likely to be flat with that of 2016, remaining around 8%. Based on the external support of stable economic growth as well as the encouragement for industrial transformation and upgrading, it is likely that the overall leasing demand will maintain its steady performance. It is predicted that the new office supply in 2017 will only be half of the number in 2016 and that will balance the overall supply and demand. The rental of Zhujiang New Town is going to see a recovery in 2017. References: JLL Guangzhou Property Market Review 2016 and Vision 2017