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Markets exhibit resilience while navigating headwindsAsia PacificQ2 2025Asia Pacific ResidentialMarket DynamicsRContentsHong Kong05Beijing06Shanghai07Guangzhou08Singapore09Bangkok10Jakarta11Kuala Lumpur12Manila13Ho Chi Minh City14Delhi15Mumbai1601Report2Bengaluru17Chennai18Pune 19Kolkata20Hyderabad21Sydney22Melbourne23Brisbane24Brisbane,Ho Chi Minh City,Hong Kong*,JakartaGrowthSlowingRentsFallingRentsRisingDeclineSlowingBangkokShanghaiSingapore*Source:JLL,Real Estate Intelligence Service,Q2 2025*LuxuriousPrime Residential Rental Clock3 BeijingSydneyGuangzhou,Manila,MelbourneKuala Lumpur4Residential investmentDirect residential real estate investment 2007-YTD 2025Source:JLL,Q2 2025Note:Figures refer to transactions over USD 5 millionUSD millions02,0004,0006,0008,00010,00012,00014,000200720082009201020112012201320142015201620172018201920202021202220232024YTD 2025AustraliaChinaHong KongJapanSingaporeSouth KoreaAP OthersHong Kong Jones Lang Lasalle IP,Inc.2025Declining interest rates contribute to higher transaction volume.One residential site will be tendered in Q3 2025.Luxury residential rents continue their upward trajectory.ResearchHong KongResidential|Q2 2025HIBOR declined sharply from 4.1%at end-April to 0.9%by end-June.For a 30-year mortgage,this resulted in a monthly payment reduction of about 15.4%.The lower rates bolstered market confidence,driving a 37.5%q-o-q increase in residential transactions in Q2.Deep Water Pavilia in Wong Chuk Hang launched 101 units at an average price of HKD 20,932 per sq ft,undercutting all completed Southside projects.Mass residential capital values edged down by 0.4%q-o-q in Q2 2025.In Q1 2025,9 luxury residential units were completed.These included eight units at Onmantin in Homantin,and one unit at 48A&50 La Salle Road in Kowloon Tong.A total of 345 luxury residential units are expected to be completed in 2025.In Q3 2025,The Government will tender a residential site at Hoi Chu Road,Tuen Mun(TMTL 569),with an estimated capacity of 525 residential units.Demand in the luxury leasing market continues to be bolstered by an inflow of mainland families and the return of expatriates,with rental values rising by 0.3%q-o-q in Q2 2025.Sales momentum is rebuilding in luxury residential markets.In Q2 2025,the transaction volume for properties valued at or above HKD 50 million increased by 70.0%q-o-q.Meanwhile,luxury residential capital values declined by 1.1%q-o-q in Q2 2025.OutlookAmid oversupply and financial pressure,developers will likely maintain aggressive pricing strategies to sustain sales momentum.We expect mass and luxury residential capital values to drop by about 5%and 5-10%in 2025,respectively.Luxury rents are projected to continue rising,driven by an influx of mainland Chinese families and accelerating return of expatriates.We expect luxury residential rental values to rise by 0-5%in 2025.Cathie Chung|FundamentalsYTD total completions131 unitsNet rentHKD 41.1 p.s.f.p.m.Rent growth Y-o-Y2.0pital value HKD 33,645 p.s.f.Capital value Y-o-Y-9.1%Historical supply trendsNote:Hong Kong Residential refers to Hong Kongs overall luxury residential market.Data is on an SA basis.010020030040050060020202021202220232024YTD 2025UnitsBeijing Jones Lang Lasalle IP,Inc.2025Luxury apartment sales hit a record high.Seven projects newly launch in Q2 2025.High supply and demand in the luxury market but falling prices.ResearchBeijingResidential|Q2 2025Following the previous quarters trend,sales volumes were highly dependent on supply dynamics.In the quarter,a two-year quarterly sales peak of 2,100 units was reached,three-quarters of them from projects newly launched in H1 2025.The flight-to-quality trend continues as some top-tier residential projects with prime locations posted solid sales performances,the target customers of which made quick decisions.However,buyers were broadly cautious amid economic uncertainties.In the quarter,supply in Beijings luxury apartment market reached approximately 3,300 units,with H1 2025 overall supply exceeding the full-year figure seen in 2024.Seven high-end projects in Haidian,Chaoyang and Fengtai entered the market.Land supply remained moderate,with 11 plots transacted during the quarter.The average premium rate dropped to 2.6%.Only three land plots in the Haidian District are likely to be developed into high-end residential projects.In Q2 2025,excluding newly launched projects,the price of luxury apartments fell by 2.3%q-o-q.Although the cost of purchases has been lowered due to the loose monetary environment,confidence has not fully recovered,bringing divergent performance.The leasing market downturn in terms of lease volume continues.Also,the continued decline in secondary prices forced more sellers to change plans from selling to leasing,increasing supply in the leasing market.OutlookMonetary policy is expected to remain loose in the short-term.The current high supply and price advantages have provided buyers with more options.The annual transaction volume in the primary market will increase significantly compared to last year.With the boost in sales volume,price declines in 2025 are expected to narrow in the primary market.Secondary market prices will continue to face downward pressure as the high supply in the primary market draws some buyers away.Ming Ji|FundamentalsYTD total completions3,163 unitsGross rentRMB 137 p.s.m.p.m.Rent growth Y-o-Y-6.8pital value RMB 90,969 p.s.m.Capital value Y-o-Y-2.9%Historical supply trendsNote:Beijing Residential refers to Beijings overall luxury and high-end residential market.Data is on a GFA basis.01,0002,0003,0004,0005,0006,0007,00020202021202220232024YTD 2025UnitsShanghai Jones Lang Lasalle IP,Inc.2025High-end sales momentum in core submarkets remained solid.Ten high-end projects launched for sale in the quarter.High-end primary price continues to edge up.ResearchShanghaiResidential|Q2 2025In Q2,Shanghai eased housing credit policies by lowering minimum mortgage rates to 3.05%for first-home purchases and 3.25%for second-home purchases following Mays 10bps LPR cut,while cutting provident fund rates by 25bps to 2.6%and 3.075%to bolster demand.Primary home sales volume rose 14.0%q-o-q to 1.7 million sqm in Q2 2025.High-end sales momentum remained solid in the quarter,though projects in prime locations outperformed the others.The quarter saw 820 high-end units transacted,down 21.2%q-o-q.Developers accelerated new home launches in the quarter,pushing total new home supply to 1.67 million sqm,an increase of 114.5%q-o-q.Ten high-end projects with a total of 859 units were launched for sale in Q2 2025.The average prices of these new high-end projects ranged from RMB 138,000 per sqm to RMB 195,000 per sqm.Shanghais average high-end primary price continued to edge up by 0.6%q-o-q in the quarter,reaching RMB 147,900 per sqm.Meanwhile,the average high-end secondary price further declined,down 2.0%q-o-q to around RMB 132,800 per sqm amid slowing sales momentum.Despite a slight improvement in high-end leasing activity,the ample supply of high-end units for lease continued to exert downward pressure on rents.As such,Shanghais average high-end rent fell 1.3%q-o-q to approximately RMB 157.6 per sqm per month.OutlookWe expect pre-sale performances of new projects to diverge further.High-quality projects in prime locations will maintain strong demand from homebuyers,while others may continue to experience slower sales progress.High-end primary prices are expected to rise further,however,high-end secondary prices may remain under pressure due to caution from homebuyers,subdued price growth expectations,as well as competition from primary projects.Daniel Yao|FundamentalsYTD total completions2,282 unitsGross rentRMB 158 p.s.m.p.m.Rent growth Y-o-Y-10.8pital value RMB 132,797 p.s.m.Capital value Y-o-Y-10.7%Historical supply trendsNote:Shanghai Residential refers to Shanghais high-end residential market.Capital value figures are for the secondary market.Data is on a GFA basis.05001,0001,5002,0002,5003,0003,5004,00020202021202220232024YTD 2025UnitsGuangzhou Jones Lang Lasalle IP,Inc.2025Guangzhous residential market faces subdued demand conditions.New supply increases significantly.Capital values and rents remain on a downward trend.ResearchGuangzhouResidential|Q2 2025Guangzhous housing demand remained weak.Sluggish entry-level demand saw new home sales fall by 15.4%y-o-y.Secondary market transactions rose but relied on price cuts to drive volume.Guangzhous urban renewal was implemented smoothly,gradually releasing pent-up upgrade demand.It saw an increase in primary home sales in Tianhes Yantang and Liwan,backed by resettled residents entering into primary properties nearby.Three new projects with 763 units entered the market,while four existing projects launched additional phases totalling 1,081 units.Combined new launches reached 1,844 units,with nearly half in core areas such as Yuancun in Tianhe and Pazhou in Haizhu.A total of 1,061 high-end units across three residential projects were completed in the quarter.To boost sales,newly launched properties sold at 10%less than expected.Meanwhile,buyers demanded steeper discounts for secondary homes given inferior layouts versus new builds.Prices in the Primary and Secondary markets dropped 2.0%and 3.2%q-o-q,respectively.The rental market saw softening demand from top-tier professionals and expatriates,leading to extended vacancy periods for high-end properties.In response,landlords offered further rental incentives.OutlookAgainst growing external uncertainties and still-weak domestic demand,the recovery of market sentiment may be protracted.It is expected to continue to exert downward pressure on both prices and rents in the near-term.Secondary home prices may reflect a higher level of corrections.Properties in the Primary market in core locations and those with higher efficiency ratios are anticipated to maintain stronger price resilience.Yan Su|FundamentalsYTD total completions1,061 unitsGross rentRMB 88.8 p.s.m.p.m.Rent growth Y-o-Y-3.3pital value RMB 63,779 p.s.m.Capital value Y-o-Y-9.5%Historical supply trendsNote:Guangzhou Residential refers to Guangzhous luxury residential market.Data is on a GFA basis.01,0002,0003,0004,0005,0006,0007,00020202021202220232024YTD 2025UnitsSingapore Jones Lang Lasalle IP,Inc.2025Prime non-landed home sales volume dips in Q2 2025.Vacancy falls as demand outpaces new supply.Typical Prime non-landed housing market strengthens with continued price and rent upticks.ResearchSingaporeResidential|Q2 2025Geopolitical and economic uncertainties amid prevailing market challenges dampened developer and buyer sentiment,slowing Prime non-landed home sales in Q2 2025.21 Anderson,a small 18-unit project,was the sole project launch in the Prime market in Q2 2025.Previously launched projects such as Hill House,Watten House and The Collective at One Sophia continued to add to Prime new sales during the quarter.Sophia Regency and the Initial Sama serviced apartment development were the only projects in the Prime non-landed housing segment to receive Temporary Occupation Permits in Q2 2025.Meanwhile,Fraser Place Robertson Walk was withdrawn from the market.Stronger absorption relative to new supply resulted in a slight tightening of Prime non-landed home vacancy rates during the quarter.Despite ongoing trade and geopolitical conflicts,capital values of resale Prime non-landed homes rose in Q2.While the quarterly gains slowed from Q1,the positive trajectory reflects sustained local buyer demand in the Prime segment.In Q2,heightened uncertainties and cost sensitivity reversed the uptrend of Luxury Prime home rents since Q2 2024.Conversely,Typical Prime rents continued to rise on demand diverted from the Luxury Prime segment,reflecting the cautious market.OutlookPrime home prices may see near-term support from moderating interest rates and local buyer interest.However,economic uncertainties stemming from rising geopolitical conflicts and trade frictions may dampen demand for Prime homes.Economic headwinds and rising job market uncertainties are projected to weaken both leasing demand and rent growth for Prime non-landed private homes.Chia Siew Chuin|FundamentalsYTD total completions792 unitsGross rentSGD 5.98 p.s.f.p.m.Rent growth Y-o-Y1.7pital value SGD 3,487 p.s.f.Capital value Y-o-Y5.9%Historical supply trendsNote:Singapore Residential refers to Singapores overall prime and luxury residential markets.Financial indicators are for the luxury residential market.Data is on an NLA basis.05001,0001,5002,0002,5003,00020202021202220232024YTD 2025UnitsBangkok Jones Lang Lasalle IP,Inc.2025Policy measures spark modest revival in the market.Economic uncertainty halts new launches.Rent rise for the thirteenth consecutive quarter.ResearchBangkokResidential|Q2 2025Bangkoks luxury condo market showed slight quarterly recovery in Q2,boosted by interest rate cuts and relaxed LTV measures.The market rebounded to pre-seismic levels despite disruptions,though economic downturn and reciprocal US tariffs remained challenges.Prime apartments maintained strong momentum,with half of total inventories reaching full occupancy in the quarter.Vacancy rates declined for two consecutive quarters,dropping 51 bps to 4.2%,supported by corporate relocations.The luxury condominium inventory remained unchanged at 72,500 units,with no new completions recorded in Q2 2025.Economic uncertainties have postponed buyer decisions,leading developers to adopt a cautious approach towards new launches.The prime apartment stock expanded to 4,700 units in Q2 2025 with the addition of 39 Luxury Suites(47 units),further reinforcing the Central East submarkets position as the predominant location for prime apartments.Capital values recorded a 1.5%q-o-q increase as this quarterly moderate growth is tempered by broader economic conditions.Economic instability has continued to accelerate the market shift towards rental market.Strong demand from both domestic and foreign renters drove gross rents to THB 757 per sqm per month,achieving the 13th consecutive quarter of growth at 4.0%.The rental markets robust performance pushed market yields up to 5.2%.OutlookSix projects are expected to enter the market by 2025,with an average presales rate of 70%.Most developers prioritise on clearing inventories and taking conservative approach in new project launches until market confidence improves.Rental rates set to climb rapidly in near term due to high loan rejections,with residents favouring rentals for security and flexibility.Capital values to grow more slowly due to cautious investor sentiment.Market yields projected to maintain at 5.2%through 2025.Anawin Chiamprasert|FundamentalsYTD total completions18 unitsGross rentTHB 757 p.s.m.p.m.Rent growth Y-o-Y8.0pital value THB 154,918 p.s.m.Capital value Y-o-Y4.5%Historical supply trendsNote:Bangkok Residential refers to Bangkoks high-end and luxury residential market.Data is on an NLA basis.02,0004,0006,0008,00010,00020202021202220232024YTD 2025UnitsJakarta Jones Lang Lasalle IP,Inc.2025Demand shows slight improvement compared to previous quarter.Two projects of Le Parc,The Mansion and Townhomes,are complete.Modest price increases in the luxury segment.ResearchJakartaResidential|Q2 2025Sales activity for prime condominiums showed improvement compared to previous quarter.With no new launches,the improvement was modest.Sales were mainly driven by strategically located projects,including relatively new developments and those nearing completion.With investors maintaining a wait-and-see approach,end-users continued to dominate the market in the quarter.While no new prime condominiums were launched in the quarter,the market witnessed the completion of Le Parc,with both The Mansion and Townhomes towers reaching completion.Additional projects are scheduled for completion this year,with Savyavasa Tower 1 currently in the finishing stage expected to complete in Q3 2025,while Tower 2 and 3 are planned to initiate the handover process by the end of 2025.Prime condominium prices experienced modest increases for luxury projects.These increases were driven by projects in premium locations nearing completion.These well-positioned developments offered practical occupancy timelines,appealing to buyers.Although luxury projects experienced price increases,most developments in other segments maintained their pricing to stimulate sales activity.Developers continued to prioritize boosting sales of their current inventory rather than increasing prices.OutlookNew launches will remain limited,with no announced plans for upper-class or luxury developments in the near future.Steady demand will be anticipated,mainly coming from end-users while investors will likely continue to wait for more favorable market conditions.When market confidence strengthens and buyer sentiment improves,condominium prices will likely experience gradual increments.Desita Nanlohy|FundamentalsYTD total completions64 unitsCapital valueIDR 62,282,842 p.s.m.Capital value Y-o-Y1.4%Historical supply trendsNote:Jakarta Residential refers to Jakartas luxury condominium market.Data is on an SGA basis.02004006008001,0001,2001,40020202021202220232024YTD 2025UnitsNote:Historical supply data represents only completed units ready for occupancy,not units that have been launched or marketed while still under construction.Kuala Lumpur Jones Lang Lasalle IP,Inc.2025Global investors target Kuala Lumpur luxury homes while developers cautiously navigate economic challenges.Kuala Lumpur prime inventory grows with three new completions amid launch drought as developers remain cautious.Chinese investors rank Malaysia fourth globally for luxury property as KL offers unmatched value with genuine end-user demand.ResearchKuala LumpurResidential|Q2 2025Kuala Lumpurs prime residential market attracted diversified investment from Middle East,Asia Pacific,and Europe,while President Xis visit is expected to accelerate Chinese investment,particularly from families seeking properties near educational institutions.Despite strong domestic and international demand,developers implemented cautious measures including scaled-down projects and delayed launches due to rising costs,creating a significant supply-demand imbalance in Kuala Lumpurs prime residential sector.Isola KLCC,The Conlay and Bangsar Hill Park were completed in the quarter,adding 1,443 prime units to Kuala Lumpurs luxury stock,representing significant new inventory in key KLCC and upscale suburban locations.There was no notable project launch during the quarter,reflecting continued developer caution amid economic uncertainties and rising construction costs,contributing to the supply constraints in the prime residential segment.Malaysia climbed to fourth place globally for Chinese luxury property investors,with Kuala Lumpur prime real estate priced at just USD 240 per square foot-significantly less than comparable properties in Bangkok and 87%cheaper than Singapore.The revamped Malaysia My Second Home programme created streamlined investment pathways,while properties near educational institutions commanded premiums,reflecting the 35%increase in Chinese student enrollment at Malaysian universities since 2021.OutlookNew project launches will likely remain limited over the next 12-18 months as developers adopt cautious strategies in response to rising construction costs,influenced by government measures including SST scope expansion,which will further increase construction costs.Despite economic uncertainties limiting new launches,Kuala Lumpurs prime residential market offered attractive 3.49%yields and strong value preservation potential,particularly for properties near prestigious educational institutions.Yulia Nikulicheva|FundamentalsYTD total completions3,067 unitsGross rentMYR 3.33 p.s.f.p.m.Rent growth Y-o-Y0.0pital value MYR 957 p.s.f.Capital value Y-o-Y-1.0%Historical supply trendsNote:Kuala Lumpur Residential refers to Kuala Lumpurs prime residential market.Data is on an NLA basis.01,0002,0003,0004,0005,0006,00020202021202220232024YTD 2025UnitsManila Jones Lang Lasalle IP,Inc.2025The Premium residential segment sees uptick in both rents and sales.Development delays reduce near-term supply pressure as vacancy trends downward.Investment metrics reveal stable price growth amid stable rental environment.ResearchManilaResidential|Q2 2025A positive net absorption of 160 units across the residential sector was seen in Q2 2025.Makati and Taguig posted steady lease momentum from expatriates,executives and hybrid-working professionals,reinforcing their status as premier living destinations.Likewise,the sales market demonstrated resilience with high-net-worth individuals(HNIs)and international investors maintaining transaction activity.The quarter saw no new completions as scheduled developments shifted delivery timelines to Q4 2025,with additional pipeline projects now concentrated between 2026 and 2027.Vacancy contracted to 6.7%in Q2 2025,down 22.1 bps q-o-q.The improvement stems from consistent occupier activity in Makati and Taguig,where corporate executives and professionals with flexible work arrangements continue absorbing available inventory.Rents held steady at PHP 844.8 per sqm,per month,due to consistent interest from expatriates,local executives and professionals.This stability reflects sustained demand from international assignees and corporate leaders requiring quality accommodations.Capital values appreciated by 1.6%in Q2 2025 to PHP 304,261 per sqm,reflecting strengthening sales performance and investor confidence in premium residential assets.OutlookDemand is projected to remain stable across both leasing and sales segments,supported by executive and expatriate requirements,though the substantial supply pipeline from 2025 to 2028 may introduce occupancy challenges.Rents are seen to see moderate appreciation from sustained demand by affluent domestic and international professionals.Prices likely to continue rising as new premium developments enter the market,potentially elevating valuations across Manilas prime districts.Janlo de los Reyes|FundamentalsYTD total completions391 unitsNet effective rentPHP 845 p.s.m.p.m.Rent growth Y-o-Y0.4pital value PHP 304,261 p.s.m.Capital value Y-o-Y2.8%Historical supply trendsNote:Manila Residential refers to the Makati City and Taguig City mid-high and luxury residential market.Data is on an NLA basis.01,0002,0003,0004,00020202021202220232024YTD 2025UnitsHo Chi Minh City Jones Lang Lasalle IP,Inc.2025Market rebounds with strong demand following Lunar New Year holiday period in the previous quarter.New supply shows strong improvement compared to the previous quarter,with the majority come from domestic developers.Primary prices decreased slightly as new supply was located farther,while secondary prices maintained stable growth momentum.ResearchHo Chi Minh CityResidential|Q2 2025High-end Apartment market recorded about 739 successful transactions in Q2 2025,significantly improving compared to Q1 2025(118 transactions).Demand primarily came from absorption of new supply launched during the quarter.The Luxury segment,mainly in the Eastern area,accounted for a large proportion.Additionally,projects with positive construction progress also recorded good absorption,notably the D-Homme project(DHA Corp.)which began handing over units to customers during the quarter.In Q2 2025,the High-end Apartment market welcomed 898 new units,mainly from Opus One,a Luxury segment project within the Vinhomes Grand Park township(Thu Duc).Soft-launch activities in Eastern projects were also actively implemented,especially Lumiere Mid-town with over 800 apartments in the next phase of The Global City(Masterise).Notably,most new projects in the quarter were developed by domestic companies,while foreign investors are showing caution amid many changes in Vietnams administrative system.Primary selling prices in the High-end apartment market recorded a slight decrease of 0.6%q-o-q and an increase of 1.6%y-o-y,reaching USD 5,076 USD p.s.m.The quarterly price decline was due to new projects located far from the city center such as Opus One(Thu Duc),with more competitive pricing.Meanwhile,most other primary projects recorded stable price growth of 1.0-3.0%q-o-q per project.Secondary selling prices grew steadily at 1.7%q-o-q and 9.4%y-o-y,showing stable demand from homebuyers for apartment segment.OutlookAbout 5,000-5,500 High-end Apartments are expected to enter the market in 2025.Infrastructure developments being accelerated such as An Phu interchange and Ring Road 3 will be the market driver in this year.Future supply will continue to come from prominent developers in the market,with anticipated projects such as The Galidia(Keppel Land),The Global City(Masterise Group),and Lancaster Legacy(Trung Thuy).Trang Le|FundamentalsYTD total completions1,157 unitsNet effective rentUSD 10.8 p.s.m.p.m.Rent growth Y-o-Y6.9pital value USD 3,928 p.s.m.Capital value Y-o-Y10.2%Historical supply trendsNote:Ho Chi Minh City Residential refers to Ho Chi Minh Citys high-end apartment market.Data is on an NLA basis.01,0002,0003,0004,0005,0006,00020202021202220232024YTD 2025UnitsDelhi Jones Lang Lasalle IP,Inc.2025Over 11,000 homes sell in Delhi NCR during the quarter.In Q2 2025,over 13,400 units launched in Delhi NCR.Capital Values and rents up q-o-q.ResearchDelhiMass Residential|Q2 2025A total of 11,031 housing units were sold in Q2,taking up the H1 2025 total to over 19,300 units.Almost 30%of homes sold in the quarter were in the range of INR 5 crore and above.Gurgaon continued to dominate the housing sales in the quarter with 38%share,followed by Ghaziabad at 33%and Noida at 28%.Quarterly sales in Ghaziabad were at an all-time high.On a half yearly basis,new launches in Delhi NCR were at 21,733 units.Almost two third of the new launches in the quarter were in INR 3 crore and above range.All the newly launches projects were very well received.Ghaziabad led the new supply in the quarter.Over 40%of the quarterly launches were in Ghaziabad.One of the countrys biggest developers has entered the Delhi NCR residential space by launching a township in Indirapuram,Ghaziabad.On an average,housing prices in Delhi NCR were up by 5%compared to the previous quarter and were up by over 17%on an annual basis.Ghaziabad saw the highest price increase in the quarter,with prices going up by 10%q-o-q.Home prices in both,Gurgaon and Noida went up by 4ch,q-o-q.On an annual basis,prices in both these submarkets shot up 17ch.On an annual basis,rents in Gurgaon were up by 8%whereas rents in Noida were up by 6%.OutlookHousing sales in the second half of 2025 are expected to remain steady with factors like rising disposable income,planned quality residential supply and advancement in infrastructure across Delhi NCR.Capital values and rents are expected to increase on the back of latent demand.Significant land trades for proposed residential developments have been recorded in the quarter;thus,the housing supply is expected to remain strong.Samantak Das|FundamentalsYTD total completions12,776 unitsGross rentINR 16.9 p.s.f.p.m.Rent growth Y-o-Y6.3pital value INR 7,617 p.s.f.Capital value Y-o-Y17.3%Historical supply trendsNote:Financial and physical indicators are for the overall market.Data is on a GFA basis.050,000100,000150,000200,00020202021202220232024YTD 2025Mumbai Jones Lang Lasalle IP,Inc.2025Overall sales decrease moderately q-o-q.New launches down q-o-q.Capital values increase marginally q-o-q.ResearchMumbaiMass Residential|Q2 2025Demand for residential units fell 6.7%q-o-q.More significantly,H1 sales were down 15%y-o-y,signaling slowing momentum.Rising prices&high-priced inventory overhang are primary causes for the sluggish sales.Navi Mumbai,Thane&Eastern Suburbs secured 63.4%of total sales,driven by mid and premium segments.Western Suburbs II&South-Central Mumbai contributed 22.1%of quarterly sales.Q2 new launches decreased 13.6%q-o-q to 13,271 units.H1 2025 was down by 21.8%y-o-y,signaling developer caution amid a sluggishness in sales momentum.Navi Mumbai dominated new launches(35.4%),followed by Thane(13.1%)and South Central Mumbai(12.6%).While overall Q2 launches declined,South Mumbai,South Central Mumbai,and Eastern Suburbs I submarkets saw q-o-q increases,bucking the trend.Roughly 60%of new launches were in the INR 10-30 million price range.Capital values rose modestly by 0.7%q-o-q,achieving a 4.7%y-o-y increase.To maintain sales growth,developers were ore steady in increasing prices while managing higher input costs.Rents across all submarkets saw modest growth,with Navi Mumbai and Thane leading,driven by increasing demand and infrastructure development.This fueled an overall upward trend.OutlookResidential demand is expected to remain resilient,especially for mid-segment options in suburban corridors.High unsold inventory may lead to continued developer discounts to boost sales.Infrastructure projects will enhance connectivity,ease commutes,and unlock new development avenues.This will transform the real estate landscape,boosting suburban popularity as buyers seek spacious homes and amenities,while city centers retain their appeal.Samantak Das|FundamentalsYTD total completions32,428 unitsGross rentINR 33.2 p.s.f.p.m.Rent growth Y-o-Y8.0pital value INR 14,288 p.s.f.Capital value Y-o-Y4.7%Historical supply trendsNote:Financial and physical indicators are for the overall market.Data is on a GFA basis.010,00020,00030,00040,00050,00060,00070,00020202021202220232024YTD 2025Bengaluru Jones Lang Lasalle IP,Inc.2025New home purchases down 3.2%q-o-q in Q2.New launches dropped by more than 31%q-o-q.Overall capital values and rents increased by 2.8%and 0.7%q-o-q,respectively.ResearchBengaluruMass Residential|Q2 2025Bengalurus residential market recorded a marginal dip of 3.2%in home sales compared to the previous quarter.Rising home prices have started showing an impact and with interest rates still sticky many buyers are deferring their purchase decisions.There was a surge in demand for homes priced between INR 1 crore and INR 5 crore.Godrej MSR City in Shettigere and Prestige Southern Star on Bannerghatta Road were the two new launches that attracted significant interest from homebuyers.New launches dipped in a big way q-o-q.However,most new launches were in the premium and high-end segment,ranging from INR 1 crore to INR 5 crore.The Hosur Road submarket recorded more than 6,000 new apartment units being launched,followed by the Bellary Road and Whitefield submarkets.Overall capital values rose by 2.8%q-o-q with the growing preference for high-end properties and with most new launches concentrated in the premium segment.Housing rentals witnessed a steady growth as demand remained high in prime locations such as Whitefield and Sarjapur Road,which are close to key office clusters.OutlookIT sector growth,startup expansion,rising HNI interest,and shifting demand toward premium,sustainable homes are driving Bengalurus housing market,enhancing both property values and rental returns.Residential market growth is likely to be fuelled by new corridors emerging stronger,backed by infrastructure upgradation and commercial sector expansion.Samantak Das|FundamentalsYTD total completions11,081 unitsGross rentINR 13.3 p.s.f.p.m.Rent growth Y-o-Y4.8pital value INR 6,926 p.s.f.Capital value Y-o-Y14.9%Historical supply trendsNote:Financial and physical indicators are for the overall market.Data is on a GFA basis.010,00020,00030,00040,00050,00020202021202220232024YTD 2025Chennai Jones Lang Lasalle IP,Inc.2025Housing demand at a seven-quarter high with a strong uptick in sales.New launches show strong q-o-q growth.Rising sales drive capital values upwards;rents remain stable.ResearchChennaiMass Residential|Q2 2025Chennais residential real estate market surged in Q2,with sales jumping 55%from the previous quarter and hitting a seven-quarter high.This significant growth reflects robust and ongoing demand in the citys housing sector.The Southern submarket locations,like Perumbakkam and Perungudi,accounted for most of the sales,followed by the western submarket.Projects clocking healthy sales in Q2 were Urbanrise Codename New Porur,Brigade Altius and Urbanrise Springtide.Chennais residential sector witnessed substantial expansion,with new launches climbing 25%q-o-q and an impressive 43%y-o-y growth.This accelerating development activity reflects strong market confidence and rising demand from homebuyers in the region.The Southern Suburbs submarket accounted for the largest share of the citys launches,followed by the Western and Off Central submarkets.Prominent Q2 launches included Casagrand Casamia,Voora One Sea and Casagrand Jarvis.Housing rents remained almost unchanged during the quarter.While demand for completed good properties remains healthy,rents have remained range-bound.Capital values increased by 12.1%y-o-y,owing to higher sales.Housing options in the affluent neighbourhoods of Sholinganallur,Pallavaram and Porur attracted higher rates,supported by their favourable location and proximity to social infrastructure.OutlookCity housing,traditionally concentrated in central city hubs,is now poised for significant expansion into the peripheral corridors.This shift is largely fueled by decentralized commercial growth,with new business districts emerging beyond the urban core.Rents and capital values are expected to rise in the medium-term,backed by Metro Phase 2 connecting suburban locations with core city and prominent office and retail hubs.Samantak Das|FundamentalsYTD total completions7,774 unitsGross rentINR 12.2 p.s.f.p.m.Rent growth Y-o-Y0.6pital value INR 6,112 p.s.f.Capital value Y-o-Y12.4%Historical supply trendsNote:Financial and physical indicators are for the overall market.Data is on a GFA basis.02,0004,0006,0008,00010,00020202021202220232024YTD 2025Pune Jones Lang Lasalle IP,Inc.2025Residential sales record marginal q-o-q increase.New launches down by 11%q-o-q.Capital values witness marginal q-o-q increase.ResearchPuneMass Residential|Q2 2025In Q2 2025,the city witnessed residential sales of 13,514 units,up by 4.8%q-o-q and mostly stable on a y-o-y basis,indicating sustained demand.The North-West submarket continues to drive residential sales in the city with around 28.1%in Q2,followed by the North submarket with nearly the same.These submarkets lie on the developing corridor and are more value-driven,thus driving sales activity.New launches fell 11%q-o-q,although on a y-o-y basis they were up by 13%.Except for the Prime Central and North-West submarkets,the others witnessed q-o-q growth.The North submarket had a significant 34%of the Q2 launches,followed by the North-East submarket with 23%.The price category of INR 10-15 million accounted for 22%of the total launches,the most during the quarter.The overall capital values rose by 1.5%q-o-q,corresponding to a 6.2%y-o-y growth.North-East witnessed healthier q-o-q price increases,supported by robust sales.The citys average rents are up by 1.8%y-o-y.This annual growth was primarily driven by rising demand for rental accommodation in residential areas located close to office hubs and educational institutions.OutlookThe North-East,North-West and North Pune submarkets are poised to lead market activity.Affordable land parcels,penetration of national developers into the market and upcoming infrastructure projects are expected to drive market momentum.The INR 10-15 million price segment is expected to maintain strong sales volumes.As premiumisation gathers steam,the INR 15-30 million price segment is expected to gain traction.Samantak Das|FundamentalsYTD total completions14,566 unitsGross rentINR 22.3 p.s.f.p.m.Rent growth Y-o-Y1.8pital value INR 7,899 p.s.f.Capital value Y-o-Y6.2%Historical supply trendsNote:Financial and physical indicators are for the overall market.Data is on a GFA basis.05,00010,00015,00020,00025,00020202021202220232024YTD 2025Kolkata Jones Lang Lasalle IP,Inc.2025Kolkata records housing sales of about 3,400 units in Q2 2025.Introduction of new supply remains strong in Q2 2025.Healthy growth in capital values across submarkets.ResearchKolkataMass Residential|Q2 2025Overall sales were up 5.6%q-o-q,although on a y-o-y basis,it depicted a 23%dip.The Affordable segment(up to INR 5 million)dominated the sales with 36.3%during the quarter,followed by the Mid segment(INR 5 to 10 million)with 35.1%.The South submarket emerged as a favourite with homebuyers and garnered 30.7%of the overall sales,closely followed by the East with 29.1%.Kolkata saw 3,615 unit launches in Q2 2025.The launches went up by 179.2%y-o-y.However,there was a decline of 32.9%q-o-q.The South submarket led with 57.7%of the launches,followed by the West at 25.5%.The Affordable segment(up to INR 5 million)had the most supply during the quarter.Unsold inventory remained stable at 17,238 units.New supply and stronger demand led to a significant 4.6%q-o-q capital value increase and a strong 12.2%y-o-y growth.The overall capital value increased to INR 5,261 per sq ft.The West submarket led y-o-y growth with 16.6%,followed by the South with 14.3%.The West remained the most affordable submarket.OutlookIn the short-term,upcoming quarters are likely to witness high demand from prospective homebuyers as multiple new residential launches are expected soon.Capital values are likely to strengthen.The Mid(INR 5 to 10 million)and Affordable(up to INR 5 million)segments are likely to contribute to this growth.The East submarket is expected to see most of the new supply,followed by the South.Samantak Das|FundamentalsYTD total completions10,031 unitsGross rentINR 17.0 p.s.f.p.m.Rent growth Y-o-Y2.1pital value INR 5,261 p.s.f.Capital value Y-o-Y12.2%Historical supply trendsNote:Financial and physical indicators are for the overall market.Data is on a GFA basis.02,0004,0006,0008,00010,00012,00020202021202220232024YTD 2025Hyderabad Jones Lang Lasalle IP,Inc.2025Sales up by 9.5%q-o-q with over 8,668 housing units sold in Q2.New launches steady at 10,000 units in Q2,down 29.7%y-o-y.Housing prices rise y-o-y across all submarkets.ResearchHyderabadMass Residential|Q2 2025Sales increased by 9.5%q-o-q to 8,668 units in Q2 2025,showing signs of market stabilization after the previous quarters dip.Notably,37%of homes sold in Hyderabad in Q2 were priced at INR 3.0-5.0 crore or,while 29%were in the INR 1.0-1.5 crore segment.New launches held steady at 10,039 units in Q2,showing a minimal decline of 0.4%q-o-q and also down 29.7%y-o-y.In Q2,Western Suburbs dominated new launches(86%),followed by Eastern Suburbs(6.5%).Premium segments prevailed in launches,with 89%of units priced above INR 1.0 crore.Average capital values were up 7.4%y-o-y.On a q-o-q basis,Prime Secondary(4.2%)and Prime Central(2.5%)led price growth,while Prime Secondary(10.3%),Suburbs-North(9.1%),and Prime Suburbs-West(8.2%)topped annual increases.Gross rents in Hyderabad showed an average annual increase of 3.0%y-o-y on strong demand for rental options in key locations across the city.OutlookHousing demand remains strong,driven by rising incomes,office market growth,migration,and high quality of life.Capital values will continue growing,though at a potentially slower pace in the near-term.New launches are expected to maintain focus on premium segments,driven by significantly increased land values and growing consumer preference for spacious apartments with high-quality amenities.Samantak Das|FundamentalsYTD total completions6,086 unitsGross rentINR 20.4 p.s.f.p.m.Rent growth Y-o-Y3.0pital value INR 7,473 p.s.f.Capital value Y-o-Y7.4%Historical supply trendsNote:Financial and physical indicators are for the overall market.Data is on a GFA basis.05,00010,00015,00020,00025,00030,00035,00020202021202220232024YTD 2025Sydney Jones Lang Lasalle IP,Inc.2025Apartment completions in Sydneys inner precincts in 2025 are expected to surpass 2024.Year-on-year apartment rental growth is slowing.Apartment prices are seeing increasing levels of growth.ResearchSydneyResidential|Q2 2025Apartment development in the inner precincts of Sydney is starting to show growth after a slowdown in 2022.Year to date the have been 1,172 apartments completed in Sydneys inner precincts,with a further 1,500 expected for completion later in the year.Completions have been slower to achieve after commencement,a trend that is seen nationally.Annual apartment completions are expected to rise further into 2027,yet still below pre-2020 levels.Sydneys median apartment sale price saw a 3.1%growth rate year-on-year to Q2 2025,and an increase on the year-on-year growth rate seen in Q1 2025(1.3%).The increase in this growth rate has been seen throughout 2025,however is lagging the house market which saw year-on-year median sale price growth of 4.7%.The median apartment rental price in Sydney remains at its all-time peak of$720 per week,however,has remained constant at this level though 2025.With the stagnation in rental price growth,the year-on-year growth rate of the median rental price reduced to 4.3%in Q2 2025 from 5.9%in Q1 2025.Rental vacancy has remained at 1.5%over the quarter across Greater Sydney.Renters are increasingly staying put with the number of new apartment leases at a 10-year low.Sales volumes have increased year-on-year for apartments,however,are down on Q4 2024.New apartment leases are down on Q2 2024;however,these are up on Q4 2024,which was a 10-year low.House rentals have followed a similar trend,now also rising from a 10-year low.OutlookA supply and demand imbalance will likely remain a driver for pricing growth in the short term.Reductions in the cash rate will likely further push demand levels,alleviating some of the affordability constraints.Any increased buyer activity,and upward pricing trends as a result may accelerate development activity.The NSW Governments Pre-Sale Finance Guarantee is also likely to accelerate housing development.Will Silk| FundamentalsYTD total completions1,172 unitsRent(2-bedroom)AUD 720 p.w.Rent growth Y-o-Y4.3%Median priceAUD 795,000Price growth Y-o-Y3.1001,0001,5002,0002,5003,0003,5004,0004,50020202021202220232024YTD 2025UnitsNote:Sydney Residential refers to Inner Sydney apartments.Source:JLL Research,ValoremHistorical supply trendsMelbourne Jones Lang Lasalle IP,Inc.2025Melbourne apartment completions in 2025 are projected to be at a 10-year low.Median apartment sale prices have remained stagnant for the last two-year period.Apartment rents are still seeing growth,providing some confidence to investors.ResearchMelbourneResidential|Q2 2025Apartment supply in Melbourne is projected to be at a 10-year low in 2025.Year to date there have been 771 apartment completions in Inner Melbourne,with a further 1,2600 expected to be completed by the end of the year.This will be a 53%reduction on the number completed in 2024 and 28%less than the previous low point in 2022.Construction cost-push with reduced realisation rates are delaying project commencements,compounding supply constraints.Melbournes apartment market continues to face challenges with the median sale price seeing small,yet negative growth at 0.2%year-on-year to Q2 2025 however the median sale price of$610,000 has remained relatively stable since Q2 2023.Median apartment rental growth continues to slow into Q2 2025,however is still positive with the median apartment rents increasing 3.0%year-on-year.Melbourne continues to have the highest vacancy rate amongst the capital cities with rental vacancy currently at 1.7%.While prices have remained stable,the volume of apartment sales has increased year-on-year and is well up on pre-COVID volumes.The cash rate cut in Q2 2025,and stable pricing is making it easier for first-home buyers to enter the market with confidence,supporting these sales volumes.Investors will also be enticed into the apartment market with increased returns due to rental growth,underpinned by a subdued supply outlook.OutlookFurther reductions the cash rate through the remainder of the year and into 2026 will support buyer confidence,with the expectation this will lift market activity and may begin to see movement in capital growth.Supply pressures are likely to felt out towards 2030,however there are development projects that have been approved and could be brought forward to meet demand,especially build-to-rent projects for the rental market.Will Silk|FundamentalsYTD total completions771 unitsRent(2-bedroom)AUD 570 p.w.Rent growth Y-o-Y3.6%Median priceAUD 610,000Price growth Y-o-Y-0.2,0002,0003,0004,0005,0006,0007,0008,00020202021202220232024YTD 2025UnitsHistorical supply trendsNote:Melbourne Residential refers to Inner Melbourne apartments.Source:JLL Research,ValoremBrisbane Jones Lang Lasalle IP,Inc.2025Brisbanes apartment completions in 2025 are expected to be at the highest level since 2018.The rate of apartment sales price growth has started to reduce but remains exceptionally high.Cash rate cuts are likely to put additional pressures on the apartment market.ResearchBrisbaneResidential|Q2 2025Brisbanes apartment market has already seen more completions in 2025 year to date,than any of the last five full years.Year to date there have been 1,947 completions,and there are projects to be over 1,250 more before the end of the year.2025 will be the first year since 2018 to see over 3,000 completions annually.Some of this is due to delays in completions from 2024.Apartment sale prices are starting to see a slowdown in the rate of growth however this is still at very high levels.Median apartment sale prices increased 19.3%in the 12-month period to the end of Q2 2025.In contrast to the house market in Brisbane saw a median price increase of 10.1%over the same period.Brisbanes apartment rental market has remained stable through Q2 2025,with annual growth now at 7.1ross the apartment market.This growth remains high when compared to other capital cities across Australia and is a testament to the demand for residential property in Brisbane.Rental vacancy has decreased slightly to 0.9%over the quarter across Greater Brisbane and remains a tight market.Renters are increasingly staying put with the number of new apartment leases at a 10-year low.Activity in the existing market is expected to remain subdued with owners holding steady to maximise capital growth,and tenants staying put to minimise rental increases.OutlookThe housing market is likely to continue experiencing significant pressure.While the supply pipeline is growing a supply and demand imbalance is likely to persist in the short term.Population growth and further cash rate cuts are expected to continue fuelling sale price growth.Rental pricing is expected to see modest,yet consistent growth into the medium term.Spillover rental demand from the ownership market will grow as sale prices climb,and even with reduced borrowing costs,become increasingly unaffordable.Will Silk Will Silk| FundamentalsYTD total completions1,947 unitsRent(2-bedroom)AUD 600 p.w.Rent growth Y-o-Y5.3%Median priceAUD 650,000Price growth Y-o-Y19.3%Note:Brisbane Residential refers to Inner Brisbane apartments.05001,0001,5002,0002,50020202021202220232024YTD 2025UnitsHistorical supply trends25Asia Pacific Roddy Allan Chief Research OfficerAsia Pacific 852 2846 Greater China Hong Kong Cathie Chung Senior Director-Hong Kong 852 2846 China Daniel Yao Head of Research China 86 86 Taiwan Morris Zhao Head of Research-Taiwan 886 976 914 To find out more about JLL services,contact:Macau Mark Wong Director 853 2871 North Asia North Asia Japan Takeshi Akagi Head of Research Japan 81 3 5501 South Korea Veronica Shim Head of Research Korea 82 2 3704 South East Asia South East Asia Dr Chua Yang LiangHead of Research and Consultancy South East Asia 852 2846 Indonesia Yunus Karim Head of Research-Indonesia 62 21 2922 Philippines Janlo Delosreyes Head of Research Philippines 63 2 902 Thailand Anawin Chiamprasert Head of Research Thailand 66 2 624 Vietnam Trang Le Head of Country and Research Vietnam 84 8 3910 Malaysia Yulia Nikulicheva Head of Research andConsultancy Malaysia 60 19 226 South Asia South Asia India India Dr Samantak Das Head of Research India 91 22 6620 Australasia Australasia Australia Andrew Ballantyne Head of Research Australia 61 2 9220 New Zealand Chris DibbleHead of Research-New Zealand 64 21 242 26Research at JLLJLLs research team delivers intelligence,analysis and insight through marketleading reports and services that illuminate todays commercial real estate dynamics and identify tomorrows challenges and opportunities.Our more than 550 global research professionals track and analyze economic and property trends and forecast future conditions in over 60 countries,producing unrivalled local and global perspectives.Our research and expertise,fueled by real-time information and innovative thinking around the world,creates a competitive advantage for our clients and drives successful strategies and optimal real estate decisions.About JLLFor over 200 years,JLL(NYSE:JLL),a leading global commercial real estate and investment management company,has helped clients buy,build,occupy,manage and invest in a variety of commercial,industrial,hotel,residential and retail properties.A Fortune 500 company with annual revenueof$20.8 billion and operations in over 80 countries around the world,our more than 111,000 employees bring the power of a global platform combined with local expertise.Driven by our purpose to shape the future of real estate for a better world,we help our clients,people and communities SEE A BRIGHTER WAY.JLL is the brand name,and a registered trademark,of Jones Lang LaSalle Incorporated.For further information,visit .COPYRIGHT JONES LANG LASALLE IP,INC.2025This report has been prepared solely for information purposes and does not necessarily purport to be a complete analysis of the topics discussed,which are inherently unpredictable.It has been based on sources we believe to be reliable,but we have not independently verified those sources and we do not guarantee that the information in the report is accurate or complete.Any views expressed in the report reflect our judgment at this date and are subject to change without notice.Statements that are forward-looking involve known and unknown risks and uncertainties that may cause future realities to be materially different from those implied by such forward-looking statements.Advice we give to clients in particular situations may differ from the views expressed in this report.No investment or other business decisions should be made based solely on the views expressed in this report.
2025-08-22
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Heightened caution amid market uncertaintyAsia PacificQ2 2025Asia Pacific Industrial Market DynamicsR Jones Lang Lasalle IP,Inc.2025Contents01Asia Pacific05Hong Kong06Beijing07Shanghai08Tokyo09Seoul10Singapore11Thailand12Jakarta13Kuala Lumpur14Vietnam North15Vietnam South16Delhi17Bengaluru18Sydney19Melbourne20Brisbane21Perth22Adelaide23Auckland24022 Jones Lang Lasalle IP,Inc.2025Adelaide,Auckland,JakartaIndustrial Rental Clock3 GrowthSlowingRentsFallingRentsRisingDeclineSlowingPerthSingapore(Business Park),Singapore(Logistics)Melbourne,Seoul,Sydney,Thailand,TokyoKuala LumpurSource:JLL,Real Estate Intelligence Service,Q2 2025*Logistics space(Hong Kong,Shanghai,Beijing,Greater Tokyo)BeijingShanghaiHong KongNorth Vietnam,South VietnamBrisbane,Wellington Jones Lang Lasalle IP,Inc.20254Industrial investmentSource:JLL,Q2 2025Figures refer to transactions over USD 5 millionDirect Industrial real estate investment 2007-YTD 2025USD millions010,00020,00030,00040,00050,000200720082009201020112012201320142015201620172018201920202021202220232024YTD 2025AustraliaChinaHong KongJapanSingaporeSouth KoreaAP OthersAsia Pacific Jones Lang Lasalle IP,Inc.2025Quarterly net absorption fell for the second consecutive quarter in Q2 2025,amid subdued leasing demand and occupier caution as the impact of tariffs started to surface.Limited demand was mainly led by 3PLs in a handful of markets.While vacancy remained flat at 13.4%in Q2,the high vacancy environment is expected to remain in the medium term.Investment activity was varied across the region,as investors generally stayed cautious in Greater China.On the other hand,markets like Tokyo,Seoul,Sydney,and Melbourne noted strong demand and transaction activity.ResearchAsia PacificIndustrial|Q2 2025Quarterly net absorption continued to fall in Q2 2025,as more occupiers started adopting a wait-and-see approach and tariff-related headwinds started filtering through markets.Leasing demand remained subdued across the board,with limited activity mainly led by 3PLs in select markets.Following three consecutive quarters of moderation,new supply increased in Q2 to 4.5 million sqm.Vacancy held steady at 13.4%but remains elevated compared to the historical 10-year average of 10.0%from 2015 to 2024.Rents continued their downward decline,weighed down by Greater China on the back of market uncertainty and a demand-supply imbalance.On the flipside,Seoul recorded a slight increase in rents.Tokyo remained a bifurcated market.Rents remained flat in Singapore and Melbourne,while face rents were stable in Sydney although incentives increased for big-box developments.Investment activity across the region was varied in Q2.No transactions were noted in Beijing,Shanghai,and Singapore.Given the overall challenging conditions,investors generally stayed cautious in Greater China.Tokyo saw strong demand from both domestic and international investors,especially for assets with full occupancy.Meanwhile,Seoul recorded some major transactions,with signs of emerging core opportunities and improvements in liquidity.Investment activity was elevated in Sydney and Melbourne.OutlookLooking ahead,heightened occupier caution is expected to persist in the medium term,with landlords opting to offer more incentives to fill up vacancies.Downward pressures from completions are likely to ease off as new supply moderates.Vacancy is slated to come down,albeit at a slow rate as the market continues to absorb the excess space.Investor appetite is expected to be sustained,but with more caution and selectivity.Elizabeth Low|Historical supply and demand trends05101520253020202021202220232024YTD 2025s.m.(millions)Net absorptionTotal completionsNote:Data is on a GFA basis.Rent growth Y-o-Y based on Asia Pacific rental index.FundamentalsYTD net absorption7.2 million s.m.YTD completions8.2 million s.m.Vacancy rate13.4%Rent growth Y-o-Y-5.0%Note:JLL Researchs basket of tracked cities was expanded in Q2 2025.Historical data has been recalculated to incorporate these additions,resulting in some changes to previously reported values.Hong Kong Jones Lang Lasalle IP,Inc.2025Relocation demand as the primary driver of new lettings in Q2 2025.Non-renewals and limited new lettings drive vacancy upward.Transaction velocity slows further compared to Q1 2025.ResearchHong KongIndustrial|Q2 2025OM Log(Asia)Ltd moved within Tuen Mun,from YKK Building to Goodman Western Plaza,occupying 53,000 sq ft.Mott MacDonald Hong Kong relocated from Wearbest Industrial Building in Tokwawan to Tins Centre Block 1 in Tuen Mun,taking up 6,709 sq ft.The vacancy rate increased to 9.1%in Q2 2025,up from 8.9%in the previous quarter.No new supply was recorded in Q2 2025.Sales of primary modern industrial projects slowed but continued.For example,Man Chong International Development Ltd acquired a floor in the Orient International Tower in Cheung Sha Wan for HKD 62.9 million(HKD 5,800 per sq ft).All primary units at Qi Feng Capitals Horizon East in San Po Kong,completed in 2022,have been sold according to market news.The average price was around HKD 4,200 per sq ft.OutlookFrontloading trade demand is expected to continue during the 90-day truce between mainland China and the US,potentially leading to a temporary surge in logistics demand.Given the still-weakened market fundamentals and the prevailing uncertainty in the market,the increase in prime warehouse vacancy and rent corrections are likely to persist in the next 12 months.Cathie Chung|Historical supply and demand trendsNote:Hong Kong Industrial refers to Hong Kongs industrial warehouse market.Data is on a GFA basis.FundamentalsYTD net absorption-744,900 s.f.YTD completions0 s.f.Vacancy rate9.1%Net effective rent HKD 12.3 p.s.f.p.m.Rent growth Y-o-Y-6.0%Stage in rental cycleRents Falling-4%-2%0%2%4%6%8%-2-101234520202021202220232024YTD 2025s.f.(millions)Net absorptionNew supplyVacancy rateBeijing Jones Lang Lasalle IP,Inc.2025Cost-saving relocations drive leasing demand;Pinggu becomes more attractive.The industrial market enters a high supply cycle.Rents decrease further amid elevated vacancy levels.ResearchBeijingIndustrial|Q2 2025In H1 2025,sluggish retail consumption and the increasing demand for cost-cutting by enterprises have significantly restrained demand for new and expanded leasing in the industrial market,with relocations being the primary source of leasing activity.Several e-commerce,F&B and daily grocery product companies,previously located in the mature market near Beijing,have gradually relocated to Pinggu,where rents were lower,resulting in no significant growth in Beijings net absorption.A project in the Pinggu submarket entered the market in the quarter,marking the third new project located in Pinggu and bringing the H1 total to approximately 531,000 sqm.The beginning of a high-supply cycle is expected to begin in 2025.Surplus supply and low net take-up increased the q-o-q vacancy rate by 4.4%to 29.6%.The vacancy rate of traditional mature industrial submarkets like Shunyi,Daxing and Tongzhou also appeared to be on the increase.The combination of strong competition and high market supply resulted in downward pressure on rents,causing average net effective rents to drop 5.9%.The elevated vacancy forced owners to decrease rents to enhance leasing competitiveness.Economic and market uncertainty continued to weigh on investor sentiment.No major en bloc deals closed in Q2 2025.Yields further decompressed as investors remained cautious in their investment decision-making.OutlookIt is expected that in the second half of 2025,as rents fall,the cost-effectiveness of Beijings industrial projects will continue to improve,which is expected to stimulate the release of warehousing upgrade needs.In the future,rent reductions in the Beijing industrial market are expected to drive some tenants to return to Beijing from projects in Langfang and Tianjin,which previously attracted a large portion of demand.Ming Ji|Historical supply and demand trendsNote:Beijing Industrial refers to Beijings prime non-bonded logistics market.Data is on a GFA basis.FundamentalsYTD net absorption-47,200 s.m.YTD completions530,800 s.m.Vacancy rate29.6%Net effective rent RMB 1.36 p.s.m.per dayRent growth Y-o-Y-11.8%Stage in rental cycleRents Falling-5%0%5 %05%-20002004006008001,00020202021202220232024YTD2025s.m.(thousands)Net absorptionNew supplyVacancy rateShanghai Jones Lang Lasalle IP,Inc.2025Tenants are mostly cost-conscious.One project is completed in Q2 2025.Rents continue to feel downward pressure.ResearchShanghaiIndustrial|Q2 2025In Q2 2025,the overall demand remained relatively stable,with leasing activities mostly driven by tenants searching for lower costs.Net absorption recorded 62,000 sqm,while vacancy increased to 28.7%amid the delivery of new supply.3PL remained the major demand driver.For example,a local 3PL provider leased over 10,000 sqm in the Jinshan submarket.Meanwhile,the Songjiang submarket continued to see demand from food trading companies.Supply continued to increase in the Shanghai logistics market with one major project delivered in Q2 2025,adding more than 190,000 sqm and marking the third new project delivered in the Fengxian submarket in the past nine months.There was over 600,000 sqm of new space completed in Shanghai over H1 2025,located in Fengxian,Songjiang,Qingpu and Jinshan.Over the remainder of the year,four more projects are expected to complete,delivering approximately 390,000 sqm.Overall rents decreased by 5.2%q-o-q on a like-for-like basis,to RMB 1.27 per sqm,per day,reflecting a 14.4%y-o-y decline.With tenants remaining cost-sensitive and vacancies staying elevated,landlords persisted with competitive pricing tactics.No major transactions were recorded in Shanghais logistics market in the quarter.Investors remained cautious in investment decisions due to declining rents and elevated supply,and they required more of a discount to compensate for the risks.OutlookWith over 1.0 million sqm of annual new supply entering the market in 2025,elevated vacancy levels are likely to persist,driving landlords to prioritise inventory absorption.A more pronounced slowdown in supply is anticipated from 2026 onwards.Landlord competition is likely to remain intense,as tenants explore nearby markets for more affordable rental options.Rent declines are expected to continue through 2025,with the pace of decrease potentially slowing in 2026.Daniel Yao|Historical supply and demand trendsNote:Shanghai Industrial refers to Shanghais modern warehouse facilities.Data is on a GFA basis.FundamentalsYTD net absorption151,000 s.m.YTD completions635,900 s.m.Vacancy rate28.7%Net effective rent RMB 1.27 p.s.m.per dayRent growth Y-o-Y-14.4%Stage in rental cycleRents Falling-5%0%5 %05004006008001,0001,2001,4001,60020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateTokyo Jones Lang Lasalle IP,Inc.2025Demand from 3PLs and online retailers continues to expand.Overall vacancy remains unchanged at 10.3%.Rent growth trend continues.ResearchTokyoIndustrial|Q2 2025Demand pushed net absorption to 332,000 sqm in Q2 2025.This was down 43%q-o-q,primarily due to reduced supply.As transport costs rise,demand is strong for properties close to the city centre with short transportation distances,while properties in fringe areas with higher transport costs are struggling to find favour.New supply totalled 358,000 sqm in Q2 2025,increasing total stock by 1.5%q-o-q.Four facilities entered the market.All four are located in the Tokyo Inland area,with two located in the Ken-O Expressway area.The vacancy rate in Greater Tokyo was 10.3%for Q2 2025,unchanged q-o-q and up 64 bps y-o-y.The vacancy rate in the Bay Area fell to 8.4%,a decrease of 18 bps q-o-q,while in Tokyo Inland it remained unchanged at 11.0%.Gross rents in Greater Tokyo averaged JPY 4,704 per tsubo,per month in Q2,up 0.6%q-o-q and up 1.4%y-o-y.Rising construction costs are pushing up rents for newly supplied properties,which in turn is pushing up rents for existing properties.Capital values in Greater Tokyo rose 0.4%q-o-q and 1.1%y-o-y in Q2 2025,reflecting rent increases.Notable sales transactions included the portfolio acquired by Fortress Investment Group and sold by GLP J-REIT.OutlookAs demand continues to grow and construction costs rise,rents are expected to grow,especially for properties in areas with good access.However,given the higher vacancy rates and increases in transportation costs,rents are under downward pressure in fringe areas.Interest rates are expected to rise further.Nevertheless,there is strong investment demand from both core investors,such as insurance companies,and value-add investors.Capital values of properties in good locations are expected to rise,coupled with growing rents.Takeshi Akagi|Historical supply and demand trendsNote:Tokyo Industrial refers to the Greater Tokyo prime logistics market.Data is on an NLA basis.FundamentalsYTD net absorption920,300 s.m.YTD completions1,213,000 s.m.Vacancy rate10.3%Gross rent JPY 4,704 per tsubo p.m.Rent growth Y-o-Y1.4%Stage in rental cycleGrowth Slowing0%2%4%6%82320202021202220232024YTD 2025s.m.(millions)Net absorptionNew supplyVacancy rateSeoul Jones Lang Lasalle IP,Inc.2025Net absorption is being driven by new centres that have been completed since 2024.Supply decrease becomes very noticeable in the first half of the year.The SCA logistics cap rate maintains the same level as the previous quarter at 5.3%.ResearchSeoulIndustrial|Q2 2025In Q2,the net absorption in the SCA Grade A market recorded 68,500 pyeong,marking the lowest level since Q3 2020.The Norths net absorption reverted to negative upon the departure of an anchor tenant,while other centres saw muted leasing activity.The South recorded the highest net absorption,with new tenants including 3PL,interior and apparel companies moving in.The Central welcomed new tenants such as e-commerce,recording a net absorption of 21,300 pyeong in the quarter,the highest in 10 quarters.Four new logistics centres were supplied,with one centre being supplied in each submarket except the West.This recorded the lowest supply volume in 15 quarters.The West,which recorded the highest supply last year,did not see any new supply in H1 2025.The SCA vacancy rate remained at 16.4%.The vacancy rates in the Central,South and West decreased,while those in the North and South-east increased.Newly supplied centres in the North remained entirely vacant,leading to a significant increase in the vacancy rate.Net effective rent recorded KRW 32,000,up by 1.1%q-o-q.Rents in all submarkets increased,with the Central showing the highest increase at 3.1%q-o-q as newly supplied centre in prime location offered rent higher than the market average.The logistics investment market was quite subdued,recording KRW 385 billion in transaction volume.The most notable deal was the Gyeongsan Coupang Logistics Center,sold by Value Corporation to IGIS Asset Management for KRW 155.8 billion.OutlookSupply in the H2 2025 is expected to be similar to H1 2025,with annual supply projected to be less than one-third of 2024s supply.Effective rents are expected to record a moderate increase,with last-mile centres potentially seeing higher rent increases.As market liquidity increases,expectations for an active investment market are growing.With a gap between seller and buyer expectations,only selective properties may close deals.For core assets in prime locations,the risk premium on borrowing costs has decreased.Veronica Shim|Historical supply and demand trendsNote:Seoul Industrial refers to Seoul Capital Areas prime logistics market.Data is on a GFA basis.FundamentalsYTD net absorption223,000 pyeongYTD completions189,200 pyeongVacancy rate16.4%Net effective rent KRW 31,988 per pyeong p.m.Rent growth Y-o-Y3.4%Stage in rental cycleGrowth Slowing0%5 001,0001,5002,00020202021202220232024YTD 2025pyeong(thousands)Net absorptionNew supplyVacancy rateSingapore Jones Lang Lasalle IP,Inc.2025Global uncertainties and cost considerations keep occupiers hesitant.Purpose-built facilities dominate the flurry of new completions in Q2 2025.Rents and capital values stay resilient.ResearchSingaporeIndustrial|Q2 2025While most occupiers stayed cautious on their space needs,several end-users who have outsourced their logistics functions are exploring setting up their own logistics/warehousing facilities(around 40,000 to 60,000 sq ft).In Q2 2025,DP World opened its maiden facility(c.140,000 sq ft)at Mapletree Benoi Logistics Hub,DHL opened a new Pharma Hub(c.88,300 sq ft)at 8 Jurong Pier,and Tiong Nam Logistics moved from 24 Penjuru Road to its new 25 Senoko Loop facility.Mapletree Joo Koon Logistics Hub(redevelopment of 51 Benoi Road)was the only new multi-tenanted facility completed in Q2 2025,with purpose-built facilities for owner occupation making up the rest of the quarters major new completions.The latter included DSV Pearl,Chasen Logistics Services new facility,and YCHs warehouse extension.The first and final phases of Maersks World Gateway 2 and Tiong Nam Logistics facility at 25 Senoko Loop were completed in Q2 2025,respectively.Despite heightened headwinds and occupier caution,the islandwide average logistics/warehouse rent remained stable for the fourth successive quarter,underpinned by the relatively limited stock of quality space for lease.Amid investors sustained interest in logistics/warehouse assets,capital values mirrored rents and held steady for the fourth straight quarter.This kept yields unchanged in Q2 2025.OutlookThe slowdown in domestic economic and manufacturing sector growth is expected to weigh on demand and rental growth prospects.However,barring unforeseen external shocks,rents should hold steady amid a limited fresh supply of multi-tenanted space.Notwithstanding the muted rental growth outlook,lower borrowing costs and investors continued interest in logistics/warehouse assets should support capital values and keep yields steady in the coming 12 months.Doreen Goh|Historical supply and demand trends0%3%6%9234520202021202220232024YTD 2025s.f.(millions)Net absorptionNew supplyVacancy rateNote:Singapore Industrial refers to Singapores islandwide logistics/warehouse market.Data is on an NLA basis.FundamentalsYTD net absorption1.6 mil s.f.YTD completions4.6 mil s.f.Vacancy rate10.5%Gross effective rent SGD 1.71 p.s.f.p.m.Rent growth Y-o-Y0.0%Stage in rental cycleRents StableThailand Jones Lang Lasalle IP,Inc.2025Slower pace of demand growth seen in Q2 2025.Sizable completion of BTS supply in the Northern Vicinity drives market growth.Sluggish rental growth persists as competition intensifies.ResearchThailandIndustrial|Q2 2025Net absorption of prime warehouse was recorded at 66,100 sqm in Q2,the lowest figure since Q1 2024 despite the completion of significant built-to-suit supply in Wang Noi,Ayutthaya.This was due to reduced occupancy in the Eastern Economic Corridor(EEC).As a result,the market vacancy rate increased by 1.0%to reach 11.4%in Q2 2025.Negative take-up in selected projects within the EEC drove this increase in the overall vacancy rate.In Q2 2025,three projects were completed adding 125,500 sqm of net leasable area(NLA)to the market including SCX Logistics Bangna Km.20-Phase 1,ESR Asia Bowin(W1/W2),and Big C Bang Pa-in Distribution Centre.The completion of Big C Bang Pa-in Distribution Centre(Project 9 by Frasers Property),an 89,000-sqm built-to-suit distribution centre in Ayutthaya,demonstrated the growing demand in the Northern Vicinity Submarket by consumer goods retailers.The rental rate experienced a slight decrease to at 159 THB/sqm/month.The market average rental rate has remained largely unchanged over the past two years.This is due to increased market competition resulting from the entry of several new operators.Overall market capital value saw a marginal q-o-q decrease of 0.2%to THB 31,505 due to the rental rate compression.OutlookPrime grade warehouse rental rate is expected to slightly decline in the near to medium term future as over 427,000 sqm of leasable space is expected to be completed in 2025 with a backdrop of over 378,00 sqm planned in 2026-2027.Amidst a competitive landscape,developers are expected to continue diversifying asset classes and locations within the logistics and industrial sectors.Growth in manufacturing should encourage solutions that capture both logistics and industrial demand.Anawin Chiamprasert|Historical supply and demand trendsNote:Thailand Industrial refers to the Greater Bangkok prime logistics market.Data is on a GFA basis.FundamentalsYTD net absorption181,200 s.m.YTD completions218,400 s.m.Vacancy rate11.4%Gross rent THB 159 p.s.m.p.m.Rent growth Y-o-Y-0.3%Stage in rental cycleGrowth Slowing0%5 0020030040050060070020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateJakarta Jones Lang Lasalle IP,Inc.2025Growing inquiries from Chinese manufacturing companies seeking multi-functional industrial spaces.Tight vacancies of 5.9%continue with some supply expected to be completed in the third quarter.Stable rental rates prevail as landlords deploy flexible pricing strategies to attract tenants in eastern corridor.ResearchJakartaIndustrial|Q2 2025More than 50%of total inquiries came from Chinese companies seeking multi-functional industrial spaces that combined warehousing,workshop,and assembly operations.The EV sector,electronics,and automotive industries contributed to modern logistics warehouse demand.Net absorption maintained a healthy pace exceeding 100,000 sqm,matching the previous quarters performance.Most demand came from facilities in Cikarang with good accessibility to toll gates,with additional activity in Depok-Bogor and Karawang.No completions in Q2 caused vacancy rates to tighten from 9.5%to 5.9%amid healthy demand,demonstrating market resilience.The market anticipated new completions in H2 2025 with projects in Jakarta,Cikarang,and Karawang,totalling approximately 242,600 sqm.The eastern corridor(Cikarang and Karawang)was set to contribute a new supply of 102,400 sqm in H2 2025.This area maintained its status as the preferred location for foreign manufacturing companies testing the domestic market before further expansion.Net rents held steady from Q1,with competitive pricing in Cikarang and Karawang.Properties near toll gates or with limited availability saw slight price increases.Cikarang offered especially competitive rates to attract tenants.Modest rental growth against escalating land prices drive yield to compress between 7.0-7.5%.Limited industrial land availability continued driving prices up,especially in eastern Jakarta.OutlookNew supply was set to come online with a total annual addition of almost 250,000 sqm in 2025,with projections reaching 3.2 million sqm of total cumulative supply while maintaining single-digit vacancy rates of approximately 9%.Several barriers needed addressing to enhance global competitiveness and sustain FDI,including permitting processes and supporting facilities within industrial estates.Jennifer Amelia|Historical supply and demand trendsNote:Jakarta Industrial refers to the Greater Jakarta prime logistics market.Data is on a GFA basis.FundamentalsYTD net absorption207,900 s.m.YTD completions7,200 s.m.Vacancy rate5.9%Gross rent IDR 83,372 p.s.m.p.m.Rent growth Y-o-Y-0.8%Stage in rental cycleRents Rising0%2%4%6%80020030040020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateKuala Lumpur Jones Lang Lasalle IP,Inc.2025New developments fuel strong market absorption.2 million square feet added as specialized demand from Automotive,E&E industries,and 3PL providers drives market growth.Logistics sector demonstrates resilience through stable rents and strengthening investor appeal.ResearchKuala LumpurIndustrial|Q2 2025The logistics property market showed exceptional strength this quarter,with net absorption fueled by new developments.Quality facilities are experiencing rapid take-up rates,attracting strategic tenancies from sport brands and consumer product companies.Market growth continues to be driven primarily by the Automotive sector,E&E industries,and 3PL providers alongside manufacturers.Current new development projects have high occupancy and pre-commitment rates.In Q2 2025,two notable projects in Shah Alam and Pulau Indah collectively injected approximately 2 million square feet of Grade A warehouse space into the market.We observe that the vacancy rate continues to tighten and remain low,currently standing at just 2%.This low vacancy persists despite recent deliveries,as robust net absorption continues with companies strategically migrating toward premium quality spaces.Rental rates remained stable with Pulau Indah showing higher growthas new prime facilities narrow the gap with established submarkets,though upcoming SST increases and electricity adjustments in July will likely drive modest cost increases.REITs continue expanding portfolios through strategic acquisitions,demonstrated by AmanahRaya REITs Kuala Langat warehouse purchase via sale-and-leaseback that provides stable income while offering operational continuity to the tenant.OutlookThe domestic logistics sector is expected to maintain stability throughout 2025,benefiting from e-commerce expansion and support from the global technology upcycle driven by surging artificial intelligence(AI)software and hardware that increases modern space demand.Effective July 2025,Malaysia expanded the scope of its Sales and Service Tax.The revised SST now includes real estate leasing transactions.We anticipate landlords and tenants will adapt to the 8%taxation rate changes through negotiations to address tax measures.Yulia Nikulicheva|Historical supply and demand trendsNote:Kuala Lumpur Industrial refers to the Greater Kuala Lumpur prime logistics market.Data is on a GFA basis.FundamentalsYTD net absorption2,980,900 s.f.YTD completions2,119,100 s.f.Vacancy rate2.0%Gross rent MYR 2.18 p.s.f.p.m.Rent growth Y-o-Y-2.1%Stage in rental cycleGrowth Slowing0%1%2%3%4%5%6%72345620202021202220232024YTD 2025s.f.(millions)Net absorptionNew supplyVacancy rateVietnam North Jones Lang Lasalle IP,Inc.2025ResearchVietnam NorthIndustrial|Q2 2025Trang Le|Historical supply and demand trendsNote:Northern area consists of Hanoi,Hung Yen,Hai Phong,Bac Ninh and Hai Duong markets.Data on NLA basis,covering the Prime RBW only.FundamentalsYTD net absorption233,600 sqmYTD completions62,000 sqmVacancy rate21.3%Gross rent USD 4.76 p.s.m.p.m.Rent growth Y-o-Y3.5%Stage in rental cycleGrowth SlowingThe market welcomes abundant of new supply in Hung Yen(Hung Yen),Bac Ninh(Bac Ninh),and Hai Phong(Hai Phong).Demand slows down in the short term,net absorption experiences a modest level.Rental rates show a modest increase,primarily attributed to higher pricing in newly completed developments.The market continued to expand strongly with over 233,000 sqm of new Modern RBW spaces,bringing the total stock to 1.47 million sqm as of H1 2025.This was contributed from LOGOI Hung Yen,KCN Deep C Phase 2,KCN Thuan Thanh 3B(RBH area),and notably,the project DPL Vietnam Minh Quang in Hung Yen a project from a collaboration between WHA Group and Daiwa House marked the first logistics facility of these two developers in the Northern region.In H1 2025,the market has slowed down,particularly in the second quarter,reflecting challenges of volatile global economy,particularly due to the US reciprocal tariffs information.Both investors and tenants adopt a cautious approach,taking a wait-to-see stance towards ongoing negotiations with the US.Net absorption reached about 62,000 sqm,recording a modest level compared to the last period and the same period last year.Leasing activity faced challenges,the vacant spaces up to 21.3%,mainly due to the abundant new supply entering the market that needs time to be absorbed.The average rent went up by 2.79%h-o-h,reaching USD 4.76 per sqm per month.This growth was mainly attributed to the premium rates of newly launched properties which command asking rents ranging USD 5.0-5.5 per sqm per month.OutlookOutlookThe market is set to see significant growth in late 2025,adding about 922,000 sqm of newly spaces in H2 2025.Alongside new developments from key developers BWID,KCN Vietnam,LOGOS,SLP,and Sembcorp,the region will welcome newcomer MEA through project Logicross Hai Phong.US reciprocal tariffs and ongoing provincial-city mergers will continue influencing market conditions,promoting caution among investors and tenants.While demand remains soft near-term,gradual recovery is expected by late 2025.The confluence of substantial new supply and economic uncertainty will challenge leasing activity,likely reducing occupancy rates.0%5 %0.00.10.20.30.420202021202220232024YTD 2025sqm(millions)Net absorptionNew supplyVacancy rateVietnam South Jones Lang Lasalle IP,Inc.2025Warehouse leasing activities experience steady buoyancy amidst U.S.tariff challenges.HCMC(Binh Duong)and Tay Ninh(Long An)welcome new supply.Average asking rent exhibits modest growth,while market yield has remained stable.ResearchVietnam SouthIndustrial|Q2 2025Despite looming uncertainties following the U.S.reciprocal tariffs announcement,the logistics market in H1 2025 remained relatively resilient.Net absorption reached roughly 260,000 sqm,surpassing the H2 2024 figure by 6%and approaching the full-year 2024 total.RBW demand was primarily supported by domestic consumption and Chinese businesses expanding operations to Vietnam to diversify supply chains and mitigate risks.The market experienced buoyant leasing activities,with vacancy rate declining to 22.3%as of Q2 2025.The Southern RBW market continued its expansion momentum with the addition of nearly 79,000 sqm of Modern space.As of Q2 2025,total prime Modern supply scaled up to 2.2 million sqm,representing a 3.6%h-o-h and 16.0%y-o-y increase.Of this growth,BWID contributed nearly 19,000 sqm through a redeveloped project at Dong An 1 IP in HCMC(Binh Duong).MEA marked the official presence in the South by introducing its first 60,000 sqm-scale logistics park-MEA Logicross Nam Thuan in Tay Ninh(Long An).Average asking rents exhibited modest growth of 1.6%h-o-h and 2.2%y-o-y,standing at USD 4.98 per sqm per month.This positive uptick was attributed to premium rental rates from high-quality new supply and improved-performance projects.Capital value,estimated based on gross asking rents,continued its upward trajectory,albeit at a slow pace.The overall market yield has remained stable at around 8.0%amidst prevailing uncertainties in the global trade environment.OutlookThe South is poised for further expansion throughout the remainder of 2025,with nearly 164,000 sqm of new Modern space scheduled to launch in Dong Nai and Long An provinces.Existing players,KCN Vietnam and BWID,are contributors to these upcoming developments.Impact of U.S.reciprocal tariffs on market sentiment is expected to be more evident from mid-2025,though the extent remains contingent on bilateral trade negotiation outcomes.Market players have maintained a wait-and-see stance towards investment and expansion plans.Trang Le|Historical supply and demand trendsNote:Vietnam South Industrial refers to the Vietnam South prime logistics market.Data is on an NLA basis.FundamentalsYTD net absorption260,400 s.m.YTD completions79,000 s.m.Vacancy rate22.3%Gross rent USD 4.98 p.s.m.p.m.Rent growth Y-o-Y2.2%Stage in rental cycleGrowth Slowing0 00020030040050060070020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateDelhi Jones Lang Lasalle IP,Inc.2025Net absorption is up 80%y-o-y,reaching 4.13 million sq ft in H1 2025.There is increasing traction from institutional developers and investors in the market.Rents are up 5.3%y-o-y in H1 2025 due to increasing demand for Grade A space.ResearchDelhiIndustrial|Q2 2025Net demand clocked a significant 80%y-o-y growth in H1 2025,reaching 4.13 million sq ft.Of this,88%was contributed by Grade A facilities,indicating a shift in tenant preference towards good quality spaces.Delhi-NH8 dominated demand in the region.The 3PL/logistics segment was the major demand driver in the city,followed by light manufacturing sectors,including auto&ancillaries and engineering,together contributing 58%of the demand in H1 2025.Other key demand segments were FMCG,e-commerce and retail.The market expanded significantly in H1 2025 with 4.66 million sq ft of new supply additions.There was increased traction from institutional developers and investors in the market,especially in the Delhi-NH8 submarket.Vacancy rates increased to 21.4%in H1 2025 due to rising supply from large Grade A developers,including institutional investors,outpacing market demand.Rents rose by 5.3%y-o-y in H1 2025,driven by increasing demand for high-quality Grade A spaces with superior specifications.Increased traction from institutional investors also pushed rents upwards in the market.Rents are expected to increase in the upcoming years on the back of rising land prices,upcoming infrastructure projects,as well as increasing investments from institutional developers and investors.OutlookNCR warehousing stock is expected to reach 108.6 million sq ft by the end of 2025,primarily driven by Grade A projects backed by institutional investors.The Delhi-NH8 submarket will maintain its dominance.Proposed infrastructure projects,particularly along freight corridors,such as DMIC,WDFC and EDFC,are significantly influencing warehouse demand by improving connectivity between Delhi and other regions in Western and Eastern India.Chandranath Dey|Historical supply and demand trendsNote:Delhi Industrial refers to NCR Delhis overall Grade A and Grade B warehousing&light manufacturing market.Data is on a GFA basis.0%5 %468101214161820202021202220232024YTD 2025s.f.(millions)Net absorptionNew supplyVacancy rateFundamentalsYTD net absorption4,133,400 s.f.YTD completions4,655,400 s.f.Vacancy rate21.4%Gross rent INR 23.1 p.s.f.p.m.Rent growth Y-o-Y4.3%Stage in rental cycleRents RisingBengaluru Jones Lang Lasalle IP,Inc.2025Net absorption doubles from H1 2024 to reach 6.3 million sq ft in H1 2025.Grade A supply holds a 86%share of quarterly additions.Rents rise 4.4%y-o-y,with increasing demand and land prices.ResearchBengaluruIndustrial|Q2 2025In H1 2025,net absorption rose to 6.3 million sq ft,double that of H1 2024.With 87%of this demand in Grade A spaces,there is increasing occupier preference for such quality,compliant projects.Among the submarkets,Hoskote had the most,followed by Hosur Road.Major demand drivers include engineering,e-commerce and auto&ancillaries,which accounted for more than 60%of the total demand during H1 2025.Additionally,3PL/logistics,home&construction and retail sectors also made significant contributions to demand.In H1 2025,the warehousing market recorded 5.9 million sq ft of space additions,with 86%having Grade A specs,amid increasing traction from institutional developers and investors.The vacancy rates reduced by 130 bps y-o-y to reach 9.6%.Notably,the vacancy in prime Grade A spaces was considerably low at 2.0%in H1 2025.Rents rose by 4.4%over the previous year on the back of increased demand,increased traction from institutional developers/investors and an increase in land rates.This upward trend in rents is expected to continue in the foreseeable future,primarily propelled by heightened investments from institutional investors and developers such as IndoSpace,Ascendas,Welspun,etc.OutlookBengalurus warehousing sector is set for significant growth in 2025,with the total stock expected to reach 70 million sq ft.This expansion will be driven by new Grade A developments,supported by key institutional investors infusing new supply.Demand to be fuelled by various proposed infrastructure projects,including BMIC and CBIC,which will greatly improve connectivity between Bengaluru and other regions.With the increasing demand,the vacancy rates will likely hover below 8%over the next four years.Chandranath Dey|Historical supply and demand trendsNote:Bengaluru Industrial refers to Bengalurus overall Grade A and Grade B warehousing&light manufacturing market.Data is on a GFA basis.0%2%4%6%8234567820202021202220232024YTD 2025s.f.(millions)Net absorptionNew supplyVacancy rateFundamentalsYTD net absorption6,283,900 s.f.YTD completions5,899,400 s.f.Vacancy rate9.6%Gross rent INR 23.7 p.s.f.p.m.Rent growth Y-o-Y4.4%Stage in rental cycleRents RisingSydney Jones Lang Lasalle IP,Inc.2025Leasing of new completions drives quarterly volumes.Completions rebound but pipeline shrinks.Rents flat;incentives increase in some precincts.ResearchSydneyIndustrial|Q2 2025Gross take-up decreased 9.2%over the quarter to 310,000 sqm but remained 25.4ove the ten-year quarterly average.Pre-leasing and leasing of new completions accounted for 52.9%of area leased,but many tenant moves were accompanied by backfill space.The largest deal the quarter was Kmart Groups pre-commitment to a 104,500 sqm facility in Moorebank,representing Sydneys second-largest industrial leasing transaction of the last ten years.Sydney recorded 289,000 sqm of completions in Q2 2025,which were predominantly located in the Outer South West(56.2%)and Outer Central West(34.8%).Under-construction stock decreased to 876,300 sqm;however,pre-commitments increased to 57.9%,up from 39.5%previous quarter.Rents were stable in Q2 2025.Incentives increased in the Outer Central West and Outer South West,contributing to effective rent reversion.High levels of investment targeting Sydney industrial product have supported yield tightening.Prime midpoint yields compressed 6 bps in the Outer Central West and 13 bps in the Outer South West.OutlookWe anticipate that increasing vacancy,driven by speculative completions and backfill space,will further constrain face rent growth over the balance of 2025,with high incentives expected to lead to ongoing effective rent reversion in supply-heavy precincts.We expect investment volumes to remain elevated in the Sydney industrial market over the next six months,with high activity levels expected to support ongoing yield compression into 2026.Annabel McFarlane|Historical supply and demand trendsNote:Sydney Industrial refers to Sydneys industrial market(all grades).Financial and physical indicators are for the Outer Central West.Data is on a GFA basis.FundamentalsYTD gross take-up366,000 s.m.YTD completions100,600 s.m.Net rentAUD 225 p.s.m.p.a.Rent growth Y-o-Y 6.3%Stage in rental cycleRents Falling02004006008001,00020202021202220232024YTD 2025s.m.(thousands)Gross take-upNew supplyMelbourne Jones Lang Lasalle IP,Inc.2025Gross take up was centralised in Melbournes West precinct.Only 18%of completions were pre-committed in Q2 2025.Transaction volumes were 33ove the 10-year quarterly average.ResearchMelbourneIndustrial|Q2 2025Gross take up decreased for the second quarter to 21,800 sqm,15low Q1 2025 and 25low the 10-year quarterly average.The majority of this take up was concentrated in the West precinct accounting for 74%,followed by 17%in the South-East and 9%in the North.Demand was led by the transport,postal and warehouse sector accounting for 57%of gross take up space followed by retail trade at 17%,led by two major e-commerce distribution centres for fashion retail in the west.New supply in Q2 2025 totalled 227,000 sqm,36low Q1 2025 completions but 24ove the 10-year quarterly average.Of the supply,only 18%was pre-committed at practical completion.An increase in vacancy was recorded across all precincts in Q2 2025.Despite the rise,South-east vacancy remains the lowest of any east coast market.Un-committed completions and the continued rise in supply attributed to escalated vacancy levels recorded in Q2.Rents remained stable in the North precinct while a small uptick was seen in West prime pre-lease and across all grades in the South East besides high-tech.Incentives remained stable across the North and West precincts but increased slightly in the South East.Investment volumes totalled AUD 717 million across 32 transactions,33ove the ten-year quarterly average.Buyer profiles were dominated by Australian based companies and investors.OutlookHigh levels of owner-occupier purchasing is expected to ease while elevated incentive rates make renting prime facilities more attractive.Speculative developments continue to be placed on hold,awaiting pre-commitment prior to commencing construction due to oversaturation of supply within the market.Limited rental growth is forecast to continue in the near term until supply-demand dynamics rebalance.Katherine Lutze|Historical supply and demand trendsNote:Melbourne Industrial refers to Melbournes industrial market(all grades).Financial and physical indicators are for the South East.Data is on a GFA basis.FundamentalsYTD gross take-up72,700 s.m.YTD completions211,300 s.m.Net rentAUD 170 p.s.m.p.a.Rent growth Y-o-Y 3.0%Stage in rental cycleRents Stable010020030040050060020202021202220232024YTD 2025s.m.(thousands)Gross take-upNew supplyBrisbane Jones Lang Lasalle IP,Inc.2025Stable leasing activity is recorded in the Brisbane market.A high number of completions are recorded,including speculative developments.Positive rental movement across the Brisbane market.ResearchBrisbaneIndustrial|Q2 2025Occupier demand in the Brisbane market was marginally higher over Q2 2025,comparative to the previous quarter.A total of 116,700 sqm has been leased,which was below the 10-year historic average of 154,700 sqm.Tenants within the transport,postal and warehousing industry were most active during the quarter,with take-up of 43,000 sqm.The largest deal was a sub-lease from Dixie Cummings,taking 25,300 sqm in Staplyton.New completions reached 168,100 sqm,up on the previous quarter and above the 10-year historic average of 97,400 sqm.The vacancy rate has increased to 4.3%.A total of 116,900 sqm has completed in the Southern precinct,followed by 35,400 sqm in the Trade Coast and 15,900 sqm in the North.Prime net face rents remained highest in the Trade Coast at AUD 201 per sqm p.a.The Northern precinct rental growth outperformed other precincts,with a quarterly growth of 2.0%,stock has been fairly limited in Northern industrial estates.Investment volumes in Q2 2025 reached AUD 609.6 million,above the 10-year average of AUD 306.4 million.The Wacol Logistics Hub sold for AUD 240 million,which marked the largest quarterly transaction in the Brisbane market.OutlookIndustrial yields may tighten further,given investment activity remains steady.New construction likely to be postponed,in response to reduced pre-leasing activity.Ted Breene|Historical supply and demand trendsNote:Brisbane Industrial refers to Brisbanes industrial market(all grades).Financial and physical indicators are for the South.Data is on a GFA basis.FundamentalsYTD gross take-up169,700 s.m.YTD completions187,500 s.m.Net rentAUD 162 p.s.m.p.a.Rent growth Y-o-Y 9.7%Stage in rental cycleRents Falling02004006008001,00020202021202220232024YTD 2025s.m.(thousands)Gross take-upNew supplyPerth Jones Lang Lasalle IP,Inc.2025Occupier demand increases significantly in Q2 2025.Four major completions are recorded over the quarter.Prime yields tightened across all precincts over Q2 2025.ResearchPerthIndustrial|Q2 2025Occupier demand in the Perth industrial and logistics market increased over Q2 2025,with 122,200 sqm of gross take-up recorded across 16 major occupier moves(3,000 sqm).Quarterly tenant activity was above the two-year quarterly average of 67,900 sqm.Gross take-up totalled 333,300 sqm over the past 12 months,significantly above the 10-year average of 212,000 sqm.Demand was led by the transport,postal&warehousing(28.8%),professional,scientific&technical services(14.6%)and mining(9.7%)sectors.Four major developments(3,000 sqm)completed over Q2 2025,totalling 32,400 sqm.There are currently 11 projects totalling 163,900 sqm under construction,with expected completion by end-2027.Eight projects totalling 103,700 sqm are in the plans approved stage,and three projects totalling 21,900 sqm are in the plans submitted stage.The majority(85.4%)of these projects have not been pre-committed.Average prime existing net rents were stable across all precincts over Q2 2025.The North precinct recorded the strongest annual growth(8.0%),followed by the South(7.6%)and East(7.2%)precincts.Prime midpoint yields tightened 25 basis points(bps)to 6.25ross all precincts over the quarter.On an annual basis,yields were stable across all three precincts.OutlookDespite still-elevated construction and labour costs,speculative supply remains prominent in the Perth market.This new supply is expected to be supported by occupier demand expected over the short term.Rental growth is forecast to accelerate over the short term due to robust occupier demand in the Perth market.Prime yields are expected to remain stable over the rest of 2025.Helen Ye|Historical supply and demand trendsNote:Perth Industrial refers to Perths industrial market(all grades).Financial and physical indicators are for the East.Data is on a GFA basis.FundamentalsYTD gross take-up124,600 s.m.YTD completions26,800 s.m.Net rentAUD 150 p.s.m.p.a.Rent growth Y-o-Y 7.2%Stage in rental cycleRents Stable05010015020020202021202220232024YTD 2025s.m.(thousands)Gross take-upNew supplyAdelaide Jones Lang Lasalle IP,Inc.2025Quarterly gross take-up decreases over Q2 2025.Uplift in supply delivered to market over the quarter.Marginal quarter-on-quarter rental growth.ResearchAdelaideIndustrial|Q2 2025Occupier demand decreased over the quarter,with gross take-up totalling 32,300 sqm.This figure is also below the average quarterly gross take-up of approximately 37,000 sqm,recorded over the past two years.Four major occupier moves(3,000 sqm)were recorded over Q2 2025,with the largest move being an 11,500 sqm deal for an undisclosed occupier at 122-132 Purling Avenue,Edinburgh,in the Outer North precinct.There was around 93,200 sqm of new supply added to total stock in Q2 2025.Currently,there are seven major developments under construction totalling 89,300 sqm,with the latest project expected to deliver in Q1 2026.The pre-commitment rate for these projects is 40.8%.There are eight projects with plans approved in the future supply pipeline,totalling to around 110,900 sqm.Additionally,there is one project with plans submitted,totalling 5,000 sqm.Average prime net face rents increased across two precincts in Q2 2025,with quarterly growth recorded at 1.3%(Outer South)and 3.3%(Outer North).The rise in asking rents is a result of the continuing trend with occupier demand outpacing supply.Average land values increased across all precincts in Q2 2025 as availability of serviced development sites remains limited in the market.On an annual basis,average land values for 2,000 sqm lots increased between 17.9%and 45.5%.OutlookOccupier demand is anticipated to sustain in the short term,despite broader global economic uncertainty.However,speculative supply from developers is likely to be low as construction material and labour costs remain elevated.Due to low supply,competition from new builds,and a major infrastructure project which has displaced many businesses,rental growth is expected to accelerate over the short term.Prime yields are expected to be unchanged throughout 2025.Helen Ye|Historical supply and demand trendsNote:Adelaide Industrial refers to Adelaides industrial market(all grades).Financial and physical indicators are for the North West.Data is on a GFA basis.FundamentalsYTD gross take-up19,800 s.m.YTD completions10,500 s.m.Net rentAUD 149 p.s.m.p.a.Rent growth Y-o-Y 15.6%Stage in rental cycleRents Rising02040608010012014016018020202021202220232024YTD 2025s.m.(thousands)Gross take-upNew supplyAuckland Jones Lang Lasalle IP,Inc.2025Vacancy rate increases,but still sub-3%.Several large-scale projects under construction.Marginal rent growth over the quarter.ResearchAucklandIndustrial|Q2 2025The overall vacancy rate(excluding sublease space)for the Auckland region increased to 2.9%in June 2025 from 2.4%in December 2024,representing a 42 bps rise over the six-month period.On a precinct-by-precinct basis,vacancy rates stand at 2.3%(unchanged since Q4 2024)for Auckland City,at 3.8%for Manukau( 70 bps since Q2 2024),at 1.6%for North Shore( 30 bps since Q4 2024),at 4.7%for North-West( 130 bps since Q4 2024)and at 2.8%for Drury.There remains a significant pipeline,with 610,400 sqm under various stages of development,earmarked to be completed by December 2027.Goodman Property is nearing completion of its new NZD 250 million Roma Road logistics and warehouse development on the ex-Foodstuffs North Island site in Puketpapa/Mt Roskill.After remaining unchanged across all grades and precincts over the last four consecutive quarters,average net(combined)rents increased marginally this quarter,due to an increase in rents for one out of three precincts,to now stand at NZD 217 per sqm,p.a.There have been over NZD 380.40 million in sales transactions during 2025 so far,which we project will increase as a result of data reporting lags.OutlookActivity is increasingly driven by logistics and e-commerce,but the sectors diversity across manufacturing and construction services plays an integral component in the sectors depth,not to mention data centres and storage facilities.The lower interest rate environment will likely spur more investment activity from a broad range of investor groups,including local private investors,syndicators,listed companies and offshore groups,looking to increase scale in the New Zealand market.Hina Uqaili|Historical supply and demand trendsNote:Auckland Industrial refers to Aucklands logistics market.Data is on an NLA basis.FundamentalsYTD net absorption-24,200 s.m.YTD completions33,800 s.m.Vacancy rate2.80%Net rent NZD 217 p.s.m.p.a.Rent growth Y-o-Y0.9%Stage in rental cycleRents Rising0%1%2%3%4%5%-100010020030040020202021202220232024YTD2025s.m.(thousands)Net absorptionNew supplyVacancy rate Jones Lang Lasalle IP,Inc.202525Asia Pacific Roddy Allan Chief Research OfficerAsia Pacific 852 2846 Greater China Hong Kong Cathie Chung Senior Director-Hong Kong 852 2846 China Daniel Yao Head of Research China 86 86 Taiwan Morris Zhao Head of Research-Taiwan 886 976 914 To find out more about JLL services,contact:Macau Mark Wong Director 853 2871 North Asia Japan Takeshi Akagi Head of Research Japan 81 3 5501 South Korea Veronica Shim Head of Research Korea 82 2 3704 South East Asia Dr Chua Yang LiangHead of Research and Consultancy South East Asia 852 2846 Indonesia Yunus Karim Head of Research-Indonesia 62 21 2922 Philippines Janlo Delosreyes Head of Research Philippines 63 2 902 Thailand Anawin Chiamprasert Head of Research Thailand 66 2 624 Vietnam Trang Le Head of Country and Research Vietnam 84 8 3910 Malaysia Yulia Nikulicheva Head of Research andConsultancy Malaysia 60 19 226 South Asia India Dr Samantak Das Head of Research India 91 22 6620 Australasia Australia Andrew Ballantyne Head of Research Australia 61 2 9220 New Zealand Chris DibbleHead of Research-New Zealand 64 21 242 Jones Lang Lasalle IP,Inc.202526Research at JLLJLLs research team delivers intelligence,analysis and insight through marketleading reports and services that illuminate todays commercial real estate dynamics and identify tomorrows challenges and opportunities.Our more than 550 global research professionals track and analyze economic and property trends and forecast future conditions in over 60 countries,producing unrivalled local and global perspectives.Our research and expertise,fueled by real-time information and innovative thinking around the world,creates a competitive advantage for our clients and drives successful strategies and optimal real estate decisions.About JLLFor over 200 years,JLL(NYSE:JLL),a leading global commercial real estate and investment management company,has helped clients buy,build,occupy,manage and invest in a variety of commercial,industrial,hotel,residential and retail properties.A Fortune 500 company with annual revenue of$23.4 billion and operations in over 80 countries around the world,our more than 112,000 employees bring the power of a global platform combined with local expertise.Driven by our purpose to shape the future of real estate for a better world,we help our clients,people and communities SEE A BRIGHTER WAYSM.JLL is the brand name,and a registered trademark,of Jones Lang LaSalle Incorporated.For further information,visit .COPYRIGHT JONES LANG LASALLE IP,INC.2025This report has been prepared solely for information purposes and does not necessarily purport to be a complete analysis of the topics discussed,which are inherently unpredictable.It has been based on sources we believe to be reliable,but we have not independently verified those sources and we do not guarantee that the information in the report is accurate or complete.Any views expressed in the report reflect our judgment at this date and are subject to change without notice.Statements that are forward-looking involve known and unknown risks and uncertainties that may cause future realities to be materially different from those implied by such forward-looking statements.Advice we give to clients in particular situations may differ from the views expressed in this report.No investment or other business decisions should be made based solely on the views expressed in this report.
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Consumer shifts driving retail leasing landscapeAsia PacificQ2 2025Asia Pacific RetailMarket Dynamic.
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APACJune 2025Asia Pacific Fit-Out Cost Guide 2025 R 2025 Jones Lang LaSalle IP,Inc.All rights reserv.
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Resilience,reinvigorating and the rush to qualityAsia PacificQ2 2025Asia Pacific OfficeMarket DynamicsR Jones Lang Lasalle IP,Inc.2025Contents01Asia Pacific05Hong Kong06Beijing07Shanghai08Guangzhou09Shenzhen10Taipei11Tokyo12Osaka13Seoul14Singapore15Bangkok16Jakarta17Kuala Lumpur18Manila19Hanoi20Ho Chi Minh City21Delhi22Mumbai23Bengaluru24Chennai25Pune26Kolkata27Hyderabad28Sydney29Melbourne30Brisbane31Perth32Adelaide33Canberra34Auckland35Wellington3602Report2 Jones Lang Lasalle IP,Inc.2025BangkokGrade A Office Rental Clock3 GrowthSlowingRentsFallingRentsRisingDeclineSlowingMumbaiBrisbaneHyderabad,Osaka,TokyoBengaluru,DelhiJakarta,MelbourneManilaBeijing,Hong Kong,Shanghai,ShenzhenChennaiHanoi,Ho Chi Minh City,SeoulPune,SydneySource:JLL,Real Estate Intelligence Service,Q2 2025Note:Clock positions for the office sector relate to the main submarket in each city.TaipeiCanberra,PerthSingaporeGuangzhouKuala LumpurAdelaide,Auckland,Wellington Jones Lang Lasalle IP,Inc.20254Office investmentSource:JLL,Q2 2025Note:Figures refer to transactions over USD 5 millionDirect office real estate investment 2007-YTD 2025USD millions010,00020,00030,00040,00050,00060,00070,00080,00090,000100,000200720082009201020112012201320142015201620172018201920202021202220232024YTD 2025AustraliaChinaHong KongJapanSingaporeSouth KoreaAP OthersAsia Pacific Jones Lang Lasalle IP,Inc.2025Tenants concerned about rising fit-out costs may prefer renewing existing leases over costlier relocations,however demand remains strong for premium quality office spaces in prime locations,as occupiers prioritize future-proofing their portfolios through employee-centric designs and sustainability features.With an estimated 6 million sqm of new office space set to be delivered by the close of 2025,starting lease negotiations early will be key for mitigating cost pressures,securing high-quality premises,and adapt to evolving market conditions.Early mover advantage is anticipated to peak in 2025 as the cycle matures,making this year the optimal window for investment.Markets like Tokyo with robust rental growth and low vacancy continues to draw strong investor interest.ResearchAsia PacificOffice|Q2 2025The Asia Pacific office sector presented a bifurcated landscape in Q2 2025,marked by both resilience and caution amid shifting economic conditions and changing tenant priorities.Occupier decisions continued to center on premium-grade assets in prime locations,as tenants sought to optimize their real estate portfolios.Despite ongoing global economic uncertainty,the sector-maintained momentum,with regional vacancy rates stabilizing at 15%and aggregate rents rising by 0.8%quarter-on-quarter.This represents the sixth consecutive period of rental growth,with most markets experiencing moderate gains.The region witnessed a notable increase in new completions,with China and India accounting for the largest share of new supply,nearly 6 million sqm of supply is slated for completion by year end.In several markets,tenants consolidated operations into prime CBD locations.Growing demand for Global Capability Centers(GCCs)in India and significant pre-commitment leases in Hong Kong highlighted long-term,strategic investments in these hubs.Tokyo experienced a marked increase in leasing activity,primarily driven by forward commitments,resulting in further vacancy contraction to 2.4%.Seoul also saw an uptick in activity due to ongoing tenant relocations.In China,cost-sensitive demand remained a key driver,with tenants deferring decisions and landlords offering flexible leasing terms to sustain occupancy rates.Asia Pacific office investment volumes reached USD 13.2 billion,up 24%year-on-year and led by Japan and South Korea.Domestic institutional capital and end-users remained the most active investor groups.While the broader economic slowdown introduces the risk of sector repricing,markets with limited new supply are expected to demonstrate continued resilience.OutlookGlobal economic and political uncertainties are slowing occupier decision-making,but solid market fundamentals position Asia Pacific to withstand short-term volatility.A growing emphasis on flexibility and adaptability is making businesses more agile and helping to mitigate long-term space and capital expenditure risks.The ongoing flight to quality is expected to reinforce a clear divide in leasing demand,intensifying competition for premium office spaces.Ansh Goyal|Historical supply and demand trends0%2%4%6%8234567820202021202220232024YTD 2025s.m.(millions)Net absorptionNew supplyVacancy rateNote:Financial indicators are for the main submarket,while physical indicators are for the overall market.Data is on an NLA basis.FundamentalsYTD net absorption2.3 million s.m.YTD completions2.6 million s.m.Vacancy rate14.6%Rent growth Y-o-Y2.0%Hong Kong Jones Lang Lasalle IP,Inc.2025Positive net absorption with improving leasing activity.Vacancies improve in some submarkets.Rental declines across all submarkets.ResearchHong KongOffice|Q2 2025In Q2 2025,net absorption recorded a positive 274,200 sq ft.Market sentiment improved,with increased activities and ongoing negotiations among premium buildings in prime locations,particularly Central.Jane Street pre-committed 70%of office space(223,000 sq ft LFA)at Henderson Groups Phase 1 of the Site 3 New Central Harbourfront project.The firm will relocate from Chater House upon the buildings completion in 2027-28.China Merchants Plaza(142,700 sq ft)in Sheung Wan was completed in Q2 2025.The overall vacancies dropped to 13.6%as at end-Q2 2025.Several markets showed improvement,Tsimshatsui and Kowloon East saw their vacancy rates improve to 7.9%and 20.7%,respectively,while Centrals vacancy rate increased from 11.5%to 11.8%.Overall market rents declined by 1.3%q-o-q in Q2 2025,with all submarkets recording decreases.Central rents fell 0.8%,while Hong Kong East saw the largest decline(-3.7%).With banks tightening financing and a subdued rental outlook,capital values in the overall market dropped by 2.1%q-o-q in Q2 2025,while investment yields expanded marginally.OutlookRents for prime Central buildings will stabilise by the end of this year,largely driven by tenants heightened interest in trophy assets.Anchor tenants are capitalising on a first-mover advantage,engaging in negotiation for new projects years ahead of completion.Leasing activities are expected to improve in H2 2025 while vacancy pressure persists.Overall market rents will drop around 5%this year.High vacancy and falling rents are anticipated to trigger loan defaults,catalysing a cycle of distressed office dispositions.Cathie Chung|Historical supply and demand trendsNote:Financial indicators are for Central,while physical indicators are for the Grade A office market.Data is on a NLA basis.FundamentalsYTD net absorption130,700 s.f.YTD completions462,700 s.f.Vacancy rate13.6%Net effective rent HKD 73.1 p.s.f.p.m.Rent growth Y-o-Y-7.0%Stage in rental cycleRents Falling-10%-5%0%5%-4-2024620202021202220232024YTD 2025s.f.(millions)Net absorptionNew supplyVacancy rateBeijing Jones Lang Lasalle IP,Inc.2025The leasing activity stimulated by low rents fades slightly.The overall vacancy rate remains stable.The rent decline narrows but still records-4.0%q-o-q.ResearchBeijingOffice|Q2 2025As incremental leasing demand remained limited in the current market,landlords focused on retaining high-quality tenants.Many landlords offered more flexible rent discounts and extended rent-free periods for renewal leases.Technology companies showed notable performance in Q2 2025,mainly reflected in the consolidation and expansion of TMT giants in the Zhongguancun area.These companies were accommodated by both Grade A and non-Grade A projects.The expansion demand from large TMT companies contributed 70%of the net absorption in the quarter,while other incremental demand from the whole market remained limited.The overall Grade A vacancy rate decreased by 0.4 ppts q-o-q to 12.0%in Q2 2025,primarily driven by large-scale leasing transactions in the Zhongguancun and Lize areas.Overall rents fell by 4.0%q-o-q and 16.8%y-o-y,continuing its downward trend from previous quarters.However,the rents of some high-occupancy projects in Zhongguancun stabilised due to the support of technology tenants.The investment market recorded several office transactions,including a notable deal involving Sino Ocean Group,which sold a 23%share of the commercial complex Ocean International Centre Phase II to Rizhao Steel for RMB 3.22 billion.OutlookLeasing demand is expected to be driven by relocations and upgrades by existing tenants,coupled with ongoing centralisation activity in the short-term.The vacancy rate is anticipated to remain stable or decrease slightly over the medium-term.The annual rent forecast for 2025 remains at-14.8%.This low-rent phase may prompt tenants to upgrade to better offices at more attractive rates.With flexible renewal terms,landlord competition to attract tenants is anticipated to intensify.Ming Ji|Historical supply and demand trendsNote:Financial indicators are for the CBD,while physical indicators are for the Grade A office market.Data is on a GFA basis.FundamentalsYTD net absorption68,300 s.m.YTD completions0 s.m.Vacancy rate12.0%Net effective rent RMB 252 p.s.m.p.m.Rent growth Y-o-Y-18.8%Stage in rental cycleRents Falling0%4%8 $004006008001,0001,20020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateShanghai Jones Lang Lasalle IP,Inc.2025Cautious market sentiment fuels cost-driven relocations amid ongoing rent declines.Seven new projects entered the decentralised market,delivering 413,700 sqm.Overall rents remain on a downward slope in a tenant-favourable market.ResearchShanghaiOffice|Q2 2025In Q2 2025,Shanghais overall net absorption recorded 57,300 sqm.Cost-driven relocations and upgrades remained the primary drivers.Due to a turbulent global environment,some tenants adopted a wait-and-see approach,leading to a slowdown in leasing activities.In the decentralised market,net absorption recorded 74,200 sqm.State-owned enterprises and some co-working operators contributed the majority of market demand.The vacancy rate in the CBD increased by 0.2 ppts q-o-q to 16.9spite unchanged supply in Q2 2025.Landlords with high-vacancy projects remained flexible on rents.Seven new projects with a total GFA of 413,700 sqm entered the decentralised market,pushing up the vacancy rate by 1.8 ppts to 31.0%.Given the cautious market sentiment,pre-commitment for these projects was limited.In the CBD,rents decreased by 2.4%q-o-q to 6.9 RMB per sqm,per day.To retain existing key tenants and attract new ones,landlords remained flexible in both renewals and new leasing.Some even agreed to negotiate lease restructuring with extended lease terms.In the decentralised market,rents decreased by 2.7%q-o-q to 4.5 RMB per sqm,per day.As landlords competed for tenants,they continued to offer substantial rental incentives,particularly in submarkets and projects with high vacancy rates.OutlookTenants are expected to remain vigilant and driven by cost savings and will seek more advantageous leasing terms.Landlords will likely further adjust leasing strategies and rent expectations.Given the discrepancies between market rents and current tenant rents,more tenants are expected to negotiate lease restructuring.Overall market rents are anticipated to remain in a downward cycle in the short-term.Daniel Yao|Historical supply and demand trendsNote:Financial and physical indicators are for the overall Shanghai office market.Data is on a GFA basis.FundamentalsYTD net absorption148,400 s.m.YTD completions593,700 s.m.Vacancy rate24.6%Net effective rent RMB 5.58 p.s.m.per dayRent growth Y-o-Y-13.0%Stage in rental cycleRents Falling0%5 %0001,0001,5002,00020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateGuangzhou Jones Lang Lasalle IP,Inc.2025Overall leasing demand stays frail despite green shoots in the TMT sector.The average vacancy rate rises by 2.9 ppts due to new supply.Rent decline continues given falling rent affordability.ResearchGuangzhouOffice|Q2 2025Under tightening budget controls within firms,there was more caution with office expansion and relocation decisions.Also,some large domestic companies quit leasing and returned to self-owned non-Grade A space.Given contractionary leasing demand,self-use headquarters and strata-sold projects provided immense support to the quarterly net absorption of 13,600 sqm.Further,certain software service providers and e-commerce outsourcing companies sought expansion.Five new projects were completed in emerging office submarkets,namely Pazhou and Guangzhou International Financial Town(GZIFT).With little leasing progress in these projects by the end of the quarter,both citywide and submarket vacancy rates increased.The trend of medium-to-large-sized tenant outflow was particularly alarming in the core CBD,Zhujiang New Town.The submarkets vacancy rate has been climbing for six consecutive quarters despite the supply drought.The average rent affordability of Guangzhous office tenants dropped amid business uncertainties.Cuts in both lease sizes and unit rents are often required for any relocation.Moreover,supply in emerging areas remained high,and citywide rents inevitably fell.In response to the general need for cost-saving relocations,landlords in emerging areas offered exclusive discounts to high-profile,large-sized tenants to streamline the closure of cross-district relocation deals.OutlookThe clustering of tech and new retail giants has been leading companies along their industrial value chain to gather in emerging submarkets such as Pazhou.This trend is likely to bring about office demand growth in these regions.Over the next 12 months,about 775,000 sqm of new supply will be completed in Pazhou and GZIFT.Although around one-third of the space will be for corporate self-use,the additional leasing area might add to the supply competition in emerging areas.Yulun Wang|Historical supply and demand trendsNote:Financial indicators are for Zhujiang New Town,while physical indicators are for the Grade A office market.Data is on a GFA basis.FundamentalsYTD net absorption78,600 s.m.YTD completions449,400 s.m.Vacancy rate23.8%Net effective rent RMB 144 p.s.m.p.m.Rent growth Y-o-Y-11.0%Stage in rental cycleRents Falling0%5 %004006008001,00020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateShenzhen Jones Lang Lasalle IP,Inc.2025Cost optimisation continues to drive leasing demand.The influx of new supply drives citywide vacancy rate up.Tenant retention strategies intensify as rents continue to decline.ResearchShenzhenOffice|Q2 2025Companies,particularly multinationals,prioritised cost optimisation and adopted a more cautious approach to leasing.This led to a contraction in leasing demand,with demand for offices under 1,000 sqm primarily dominating the market.Supportive local policies and a strong supply chain ecosystem boosted companies tech R&D and business expansion,which drove several office upgrades and leasing transactions in consumer electronics,semiconductors and cross-border e-commerce services.Four new Grade A office projects were completed in Q2 2025,adding a total of 366,900 sqm of office space.Three of these were headquarters buildings,while two were strata titled.Projects completed in the past 1-2 years have attracted tenants with highly competitive leasing terms.However,the citywide vacancy rate remained high due to the concentrated influx of new supply,rising by 1.3 ppts q-o-q by the end of Q2 2025.Landlords of projects with persistently high vacancy rates or a recent sharp increase in vacant space were under increasing pressure to cut rents to boost occupancy.As a result,Grade A office rents fell by a further 3.1%q-o-q in the quarter.Meanwhile,landlords were focusing on retaining tenants by offering attractive renewal and restructuring terms.The gap between renewal and new lease rents narrowed in Q2 2025,with renewal rents in some buildings already approaching new lease levels.OutlookIn the next 12 months,about 1.2 million sqm of new supply is expected,with some companies relocating from current leased Grade A offices to new headquarters.The ongoing supply-demand imbalance should keep citywide vacancy high and rents declining.Shenzhens robust tech base,with rapidly growing hard-tech sectors such as AI and smart manufacturing,alongside the accelerating global expansion of South China-based enterprises,is poised to provide sustained momentum to the office market.Yulun Wang|Historical supply and demand trendsFundamentalsYTD net absorption182,400 s.m.YTD completions644,600 s.m.Vacancy rate26.5%Net effective rent RMB 135 p.s.m.p.m.Rent growth Y-o-Y-10.6%Stage in rental cycleRents Falling0 0,0002,0003,00020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateNote:Financial indicators and physical indicators are for the Grade A office market.Data is on a GFA basis.Taipei Jones Lang Lasalle IP,Inc.2025Tenants are generally deferring office demand due to economic uncertainties.New supply pipeline expected to create short-term vacancy pressure.Rental growth rate decelerates for two consecutive quarters.ResearchTaipeiOffice|Q2 2025The office market experienced a downturn in Q2 2025,with lease volume reaching only 7,000 gross pings,marking 47%of decline as tenants shelve or suspend their relocation plans amid economic uncertainties.About 48%of office transactions were small-area(below 200 pings)cases.Meanwhile,demand for co-working spaces and business centers increased,reflecting market preference for smaller,flexible offices.Net absorption was positive around 6,300 pings in Q2.Among all submarkets,the Others submarket showed the strongest absorption,primarily concentrated in the Huang Hsiang Taipei Main Station Building,with its vacancy rate decreasing by 1.2%.In addition,approximately 28,000 pings of new office supply is scheduled to enter the market in the second half of 2025.This substantial influx of inventory is expected to exert upward pressure on vacancy rates,especially in the Others submarket.Taipei CBD rental rates displayed minimal movement in Q2,with quarterly growth of just 0.07%and year-on-year growth holding at 0.63%,indicating a softening rental performance across prime office locations as the market responds to changing economic conditions.Despite this slowdown,Taipei CBD still maintained positive momentum,with average rents increasing from NTD 3,196 to NTD 3,216 per ping per month compared to the same quarter last year.This modest yet steady growth shows market stability despite challenges.OutlookInfluenced by newly completed office buildings,the rental levels may further increase in premium assets.However,excess supply coupled with cautious tenant attitudes could lead to slower absorption,potentially creating divergent performance across building classes.As a result,occupiers benefit from expanded selection and strengthened negotiating positions during lease discussions.Conversely,landlords face pressure to implement flexible leasing structures to secure quality tenants and maintain income stability.Morris Zhao|Historical supply and demand trendsNote:Financial indicators are for Xinyi,while physical indicators are for the Grade A office market.Data is on a GFA basis.FundamentalsYTD net absorption10,800 pingYTD completions9,400 pingVacancy rate6.7%Net rent NTD 3,723 per ping p.m.Rent growth Y-o-Y0.4%Stage in rental cycleGrowth Slowing0%2%4%6%80203040506020202021202220232024YTD 2025ping(thousands)Net absorptionNew supplyVacancy rateTokyo Jones Lang Lasalle IP,Inc.2025Steady tenant demand continues amid limited vacancy and positive net absorption is seen despite the completion of one new supply in the quarter.Rents rise for a sixth consecutive quarter.Further decline in vacancy rates with almost no remaining space in Otemachi/Marunouchi.ResearchTokyoOffice|Q2 2025According to the Tankan Survey in June,the diffusion index of large manufacturers rose 1 point to 13,the first rise in two quarters due to solid recovery in the iron and steel sector.The index of large non-manufacturers fell 1 point to 34 due to inbound demand.Strong demand for offices is seen due to headcount increases and flight-to-quality relocations.Net absorption was around 30,800 sqm in Q2 2025.By industry,the figure was driven by information services,wholesale and retail trade and professional services.One new Grade A office building was completed in Q2 2025.Tokyos vacancy rate in the Grade A office market in Q2 averaged 2.4%and fell 10 bps q-o-q and 120 bps y-o-y.By submarket,the vacancy rate for Otemachi/Marunouchi and Akasaka/Roppongi submarkets further compressed,with sub-1%levels seen in the former.Rents averaged JPY 36,237 per tsubo,per month,up 2.0%q-o-q and 5.9%y-o-y by end Q2 2025.Rents in both Akasaka/Roppongi and Otemachi/Marunouchi submarkets were up as landlord-favourable market conditions continue due to tight supply and demand.Capital values in Q2 2025 were up 2.9%q-o-q and 9.5%y-o-y,reflecting the continual rise in rents and unchanged cap rates from the previous quarter.A notable transaction announced this quarter was the acquisition of Akasaka Park Building by Mitsubishi Estate.OutlookAccording to Oxford Economics forecast as of June 2025,the GDP growth for year-end 2025 is 0.8%and the CPI is 2.8%.Risks include the impact of tariffs on corporate activity and a downturn in overseas economies.Leasing volumes are expected to stay solid in the second half of the year as demand for existing buildings is very robust due to strong appetite from corporates.Capital values are also expected to rise higher as rent increases exceed projections.Takeshi Akagi|Historical supply and demand trendsNote:Financial and physical indicators are for the 5 Kus Grade A office market.Data is on an NLA basis.FundamentalsYTD net absorption399,700 s.m.YTD completions366,900 s.m.Vacancy rate2.4%Gross rent JPY 36,237 per tsubo p.m.Rent growth Y-o-Y5.9%Stage in rental cycleRents Rising-2%0%2%4%6%8%-200020040060080020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateOsaka Jones Lang Lasalle IP,Inc.2025Demand remains strong,and vacancies in new supply buildings in 2024 in the Umeda area are filling up fast.“Yodoyabashi Station One”was completed,and the vacancy rate rose only 0.2%from the previous quarter to 3.3%.High rent contracts are supporting a trend toward raising rent levels further.ResearchOsakaOffice|Q2 2025The July Tankan Survey for Greater Osaka showed that business sentiment rose to 14 points from 10 for large manufacturers and rose to 33 points from 30 for large non-manufacturers.Net absorption totalled 28,000sqm in Q2 2025.Demand for office facility improvement remains high due to business acceleration,as well as the continuing return-to-office trend.In the quarter there were several consulting service providers that moved for expansion.One new building(Yodoyabashi Station One),by Chuo Nittochi and Keihan Holdings,completed in the quarter,with a GFA of 73,000 sqm and 31 storeys.Bank/financial companies and law firms relocated to this building.The Q2 2025 vacancy rate rose to 3.3%,an increase of 20 bps q-o-q and a decrease of 80 bps y-o-y.The average monthly gross rent per tsubo was JPY 24,623,an increase of 3.5%q-o-q and 8.5%y-o-y.Buildings completed in 2024 in the Umeda area have achieved high rent increases,pushing up asking rents for Osaka market.Capital values increased by 4.4%q-o-q and 11.8%y-o-y in Q2 2025,driven by current rent trends.Cap rates remained stable from the previous quarter.OutlookAccording to the June Oxford Economics forecast,Osaka Citys real GDP is projected to grow by 0.4%in 2025 but remain flat in 2026.The rental market may accelerate as companies view workplaces as a strategy to attract talent rather than as cost centres,with low vacancies in existing buildings.Owners are expected to continue to raise rents,encouraged by contracts signed at high rents.Owner dominance will be particularly pronounced for prime space in prime locations favored by tenants,and rents are unlikely to fall.There will be one more project that contributes to new supply in 2025.Investment market volume likely to decrease despite strong buyer demand due to limited selling activity.In Q2 2025,there have been several CRE(corporate real estate)sales by companies,and there are expectations for further expansion in the future.Yuto Ohigashi|Historical supply and demand trendsNote:Financial and physical indicators are for the 5 Kus Grade A office market.Data is on an NLA basis.FundamentalsYTD net absorption62,000 s.m.YTD completions35,000 s.m.Vacancy rate3.3%Gross rent JPY 24,623 per tsubo p.m.Rent growth Y-o-Y8.5%Stage in rental cycleRents Rising 0%1%2%3%4%5%-5005010015020025030020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateSeoul Jones Lang Lasalle IP,Inc.2025Overall net absorption drops to negative territory.Only the CBD shows rising vacancy as several buildings see some anchor tenant departures.Office deal volume increased 8.4%q-o-q,driven by active investments from domestic capital.ResearchSeoulOffice|Q2 2025Net absorption reverted to the negative range,recording-7,500 pyeong,as some major tenants vacated space in the CBD,such as HK Inno.N from 101 Pine Avenue A.Yeouido and Gangnam both saw positive net take-up of 1,500 pyeong and 1,300 pyeong,respectively.The most notable leasing deal in the quarter was Jongno-gu Office leasing six floors in K-Twin Tower B,taking the space previously occupied by SKC.In Gangnam,following its recent refurbishment,ICON Samseong secured the Bank of Korea as a tenant across three floors.In Q2 2025,Gangnam welcomed a new Grade B office building:OPUS 459 was completed on the former site of the Baekam Building,adding an estimated office GFA of 6,200 pyeong to the market inventory.Seouls vacancy rate rose by 38 bps q-o-q,to 3.2%.The CBD saw increased vacancies as tenants like Tmap Mobility left for newer offices within the district,thereby reaching 4.4%.Yeouido and Gangnam vacancy rates contracted to 4.0%and 1.2%,respectively.Seouls net effective rent was KRW 145,606 per pyeong,up 1.8%q-o-q,as the CBD and Gangnam both saw rent rises,reaching KRW 152,138 and KRW 156,441,respectively.Yeouidos rent dropped 0.2%q-o-q,to KRW 123,610 per pyeong due to the expansion of rent-free periods.Total office transaction volume reached around KRW 5.4 trillion,the highest quarterly volume since Q2 2021.The most notable transaction was IGIS Asset Managements purchase of SI Tower in the Gangnam from KB Investment Management for KRW 897.1 billion.OutlookAs liquidity slowly improves amid an improved financial environment with low rates,medium-sized office deals are likely to attract more investors due to their manageable investment scale and stable NOI.Those in Gangnam and Yeouido will capture greater interest.Domestic investors to become more bullish as local companies like NPS and Korea Post,who recently selected fund managers,prepare to invest in the core office sector.The participation of strategic investors for owner occupation is likely to be evident as well.Veronica Shim|Historical supply and demand trendsNote:Financial indicators are for the CBD,while physical indicators are for the Grade A office market.Data is on a GFA basis.FundamentalsYTD net absorption3,200 pyeongYTD completions0 pyeongVacancy rate3.2%Net effective rent KRW 152,138 per pyeong p.m.Rent growth Y-o-Y8.3%Stage in rental cycleGrowth Slowing0%5 010015020020202021202220232024YTD 2025pyeong(thousands)Net absorptionNew supplyVacancy rateSingapore Jones Lang Lasalle IP,Inc.2025CBD Investment Grade offices continue to attract corporate relocations despite market challenges.Office withdrawals set to deepen supply constrain over the next two years.CBD office rents maintain their modest growth amid continued occupier caution.ResearchSingaporeOffice|Q2 2025Strategic recentralisation and quality-driven relocation decisions continue to sustain demand for CBD Investment Grade office spaces,even as persistent macroeconomic and geopolitical headwinds challenge the broader market.Audi Singapore moved its office from Aperia to Capital Square and showroom from 281 Alexandra Road to 18 Cross Street while SMBC is reportedly negotiating for a floor at Capital Square to relocate its back office operations from Changi Business Park.No new office development is expected to be completed for the rest of the year.39 Robinson was withdrawn in Q2 2025 for refurbishment and partial conversion to serviced apartments.Office supply to stay limited from H2 2025 to 2027 with just three new completions:Shaw Tower,Solitaire on Cecil,and Newport Tower.At 79 Anson,the landlord has begun issuing redevelopment notices to tenants to vacate by mid-2026.CBD Investment Grade office rents maintained their modest trajectory in Q2 2025,marking the fifth straight quarter of sub-1%quarter-on-quarter growth.Capital values remained relatively stable for the fifth consecutive quarter,as economic uncertainties,muted rental increases,and tight spreads between office yields and interest rates continued to keep institutional investors on the sidelines.OutlookSingapores office market will continue to navigate headwinds through the rest of the year but the limited supply pipeline should help maintain stable to modest growth in both rents and capital values over the next 12 months,barring any shocks.More landlords are expected to implement strategic asset enhancements,including modernised lobbies,washrooms and refreshed office spaces to enhance their competitiveness and position for growth when the market recovers.Michelle Tee|Historical supply and demand trendsNote:Financial and physical indicators are for the CBD.Data is on an NLA basis.FundamentalsYTD net absorption0.3 mil s.f.YTD completions0.6 mil s.f.Vacancy rate7.0%Gross effective rent SGD 11.69 p.s.f.p.mRent growth Y-o-Y1.7%Stage in rental cycleRents Stable-6%-4%-2%0%2%4%6%8%-101220202021202220232024YTD 2025s.f.(millions)Net absorptionNew supplyVacancy rateBangkok Jones Lang Lasalle IP,Inc.2025Demand drops in Q2 as the market faces a slowdown in leasing activity.One new project was completed,while the prime office vacancy rate rose to nearly 29%.Prime rent dips slightly;capital values hold steady amid investor caution.ResearchBangkokOffice|Q2 2025Bangkoks prime office market recorded a net absorption of 9,800sqm in Q2 2025,down 42.9%q-o-q,reflecting slower leasing activity as tenants retained current spaces and adopted a wait-and-see approach following the post-earthquake situation.New leases during the quarter were mainly driven by newly completed projects,including One Bangkok Tower 4 and Grande Centre Point Lumphini,while the rest of the market saw flat to minimal occupancy gains.APAC Tower was completed,adding 32,400 sqm of space to the market.With direct BTS Ekkamai access,it has now achieved around 20%pre-commitment.The total prime stock rose to 1,603,000 sqm.The prime vacancy rate increased to 28.6%in Q2 2025,up 84 bps q-o-q,driven by new supply and subdued demand.Slower absorption is expected to continue,as older buildings face intense competition and struggle to retain tenants amid the influx of new premium offices.Prime gross rents in the CBA declined slightly by 0.4%q-o-q in Q2 2025 to THB 1,025 per sqm,though most buildings retained flat growth.Prime net effective rents likewise fell by 0.3%q-o-q to THB 784 per sqm per month.Rent-free periods averaged two months.Capital values remained steady q-o-q but rising 3.2%y-o-y to THB 167,000 per sqm.This reflected the ongoing development cost pressures,economic uncertainty,and cautious investor sentiment.OutlookTwo office projects(161,000 sqm)are set to open by end-2025.Total stock is expected to reach about 1.8 million sqm.Year-end vacancy is anticipated to hit 30%,higher than previously forecasted,due to soft business confidence and incoming supply in the pipeline.Recent and upcoming supply are expected to drive rental growth,despite a price-sensitive market with occupiers focusing on cost control.Capital values are likely to compress marginally due to tepid investor sentiment.Anawin Chiamprasert|Historical supply and demand trendsNote:Financial and physical indicators are for the CBA Grade A office market.Data is on an NLA basis.FundamentalsYTD net absorption27,100 s.m.YTD completions32,400 s.m.Vacancy rate28.6%Gross rent THB 1,025 p.s.m.p.m.Rent growth Y-o-Y1.8%Stage in rental cycleRents Rising0%5 %05010015020025030035020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateJakarta Jones Lang Lasalle IP,Inc.2025The ongoing trend of businesses simultaneously relocating and rightsizing their operations persists.No new buildings are completed in Q2 2025.Grade A rents edge up by around 0.5%compared to the previous quarter.ResearchJakartaOffice|Q2 2025In Q2 2025,Grade A office space sustained its growth trend with net demand totalling approximately 14,600 sqm.A significant portion of this demand-around 5,000 sqm-came from a technology company expanding its footprint in the CBD area.The technology sector accounted for the largest portion of office space demand by size,followed by the mining and financial sectors.During the quarter,flexible space operators showed no activity.No new Grade A office space will enter the market during 2025.Historically,the market has seen additions totalling approximately 347,000 sqm of Grade A space since 2021.The Grade A occupancy rate was 65%in Q2 2025,up slightly by 0.4 ppts from the previous quarter.As the market gradually absorbs existing supply,landlords with more vacancies are showing some flexibility in their tenant acquisition strategies.The quarter saw Grade A rents continue their upward momentum with a 0.5%q-o-q increase,while the cumulative growth for 2025 has reached approximately 1.3%.These results support the positive rent forecast for the year.Some landlords with relatively high occupancy rates have begun to adjust their rents slightly upward from recent levels.Meanwhile,landlords with higher vacancy rates are maintaining competitive pricing to attract new tenants.OutlookBy end-2025,the vacancy rate is forecast to decline slightly to approximately 34%,driven by a combination of no expected new completions and gradual improvements in demand.Cost-efficiency strategies will likely drive the continued trend of flight-to-quality with relocation and rightsizing throughout 2025.Desita Nanlohy|Historical supply and demand trendsNote:Financial and physical indicators are for the CBD Grade A office market.Data is on an NLA basis.FundamentalsYTD net absorption27,600 s.m.YTD completions0 s.m.Vacancy rate34.8%Net effective rent IDR 2,311,246 p.s.m.p.a.Rent growth Y-o-Y3.0%Stage in rental cycleRents Stable0%5 %05040608010012014016018020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateKuala Lumpur Jones Lang Lasalle IP,Inc.2025KL workspace empowering tech and financial sectors,propelled by KLCC and TRX enclave.Improved vacancy rate,despite a new completion and moderate net absorption.Balancing market absorption in more customized leasing solutions through attractive tenancy offerings.ResearchKuala LumpurOffice|Q2 2025Office demand in KL is driven by financial and tech sectors,with notable expansion within their current buildings or upgrading to newer buildings that offer competitive rates and better support for modern operations,a clear flight to quality from aging properties.Minimal growth in quarterly absorption as businesses are adopting conservative expansion strategies by delaying major operational decisions due to policy uncertainties,rising electricity costs and anticipated SST adjustments.The Exchange Campus TRX,adding 210,000 sq ft was completed by end of March 2025.This building is certified with LEED Gold standard as this feature blends the nature and the workspace in an innovative way,as the tenants can have direct access to the TRX 10-acre park.The pipeline in 2025,encompasses about 853,000 sq ft of office spaces.Key developments like The Capitol and UOA Duo Tower are now accelerating completion to 2026 from their original 2027 schedule.Mixed rental trend across submarkets,influenced by landlords are offering enhanced incentive packages,including competitive rental rates and longer rent-free period,particularly buildings anticipating longer tenant absorption.In contrast,rental rates for well-located,green buildings have remained resilient,supported by strong demand for sustainable and high-quality workspaces.OutlookHigh specs buildings with green certificates will continue to command unwavering position as landlords remain confident in their tenant attraction power despite market challenges.The upcoming implementation of SST will impact businesses with RM1,000,000 threshold.In view of our precautious stance,considering the tenant-driven market and the global economic conditions,the rental trends may experience a moderate but nonetheless steady growth trajectory.Yulia Nikulicheva|Historical supply and demand trendsNote:Financial and physical indicators are for KLC.Data is on an NLA basis.FundamentalsYTD net absorption581,900 s.f.YTD completions210,000 s.f.Vacancy rate19.2%Gross rent MYR 7.35 p.s.f.p.m.Rent growth Y-o-Y2.6%Stage in rental cycleGrowth Slowing-10%0 0%-1012320202021202220232024YTD 2025s.f.(millions)Net absorptionNew supplyVacancy rateManila Jones Lang Lasalle IP,Inc.2025Positive absorption continues as BPO and financial firms drive office leasing activity.Vacancy rates improve as developers pause completions,though significant pipeline supply remains.Rents stabilise while capital values show modest growth.ResearchManilaOffice|Q2 2025The office sector achieved around 88,200 sqm of positive net absorption in Q2 2025,bolstered by significant transactions.Taguig City captured notable deals,including a 3,500 sqm BPO commitment and a 2,000 sqm financial services lease.Meanwhile,Makati City contributed with a 1,700 sqm BPO transaction.Some rightsizing occurred as two BPO operators vacated space(1,800 sqm in Taguig City and 3,500 sqm in Makati City),as some firms continue to optimise office spaces.No new completions in Q2 as developments like Altaire and Gentry Corporate Plaza shifted timelines from Q3 2025 to early 2026.The development pipeline remains substantial,with approximately 159,000 sqm of new office space expected to enter the market by year-end 2025.Vacancy fell to 14.5%in Q2 2025,decreasing 181.3 bps q-o-q due to steady move-ins across Makati and Taguig alongside the absence of new supply.However,vacancy may face pressure as developers deliver the scheduled 159,000 sqm through the remainder of 2025.Rents remained steady at PHP 1,103.6 per sqm,per month in Q2 2025,as landlords maintained current rates to attract tenants and keep demand afloat.Capital values increased slightly by 0.4%to PHP 187,203 per sqm in Q2 2025,indicating continued investment market stability and gradually returning investor confidence.OutlookThe sector is seen to remain stable,with BPO and traditional occupiers driving leasing activity.However,the 159,000 sqm pipeline supply in 2025 presents absorption challenges,likely requiring more tenant-friendly rates in an increasingly competitive landscape.Rents may experience downward pressure as new supply enters the market,though premium buildings are expected to remain stable.Capital values will likely remain resilient with potential for growth as interest rates normalise.Janlo de los Reyes|Historical supply and demand trendsNote:Financial and physical indicators are for the Makati City and Taguig City Grade A office market.Data is on an NLA basis.FundamentalsYTD net absorption110,500 s.m.YTD completions0 s.m.Vacancy rate14.5%Net effective rent PHP 1,104 p.s.m.p.m.Rent growth Y-o-Y-1.9%Stage in rental cycleDecline Slowing-8%-4%0%4%8 %-200-100010020030040050020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateHanoi Jones Lang Lasalle IP,Inc.2025Net absorption in Grade A impacted due to restructuring while Grade B still maintain healthy demand.No new supply is introduced in the quarter.Gross asking rent remains resilient.ResearchHanoiOffice|Q2 2025Although net absorption at some buildings declined due to tenant restructuring during Q2,the market overall continued to show positive signs.Strong leasing activity in new,high-quality buildings led to a total net leasing of 3,400 sqm in H1 2025 with a 150 bps y-o-y decrease in the vacancy rate.Grade B offices continued to attract healthy leasing demand,particularly at newly completed buildings.This improvement contributed to a net absorption of approximately 5,350 sqm Q2 in total of 21,100 sqm in the first half of the year.No projects were completed over the quarter.Grade A vacancy rate edged up to 20.9%,a 140 bps increase q-o-q,primarily due to some project restructuring.Meanwhile,grade B segment saw an improvement in vacancy rate,declining by 38 bps q-o-q and 166 bps y-o-y,reaching 13.4%in Q2 2025.In Q2 2025,both Grade A and Grade B properties demonstrated stability in their gross asking rents,settling at USD 37.1 and USD 20.5 per square meter per quarter,respectively.Some existing projects with low occupancy are incentivizing tenants to lease space while most buildings continue to maintain stable rental rates.OutlookThe market is expected to see increased availability this year,with key developments,including Hanoi Centre Office in the CBD and Oriental Square in Starlake.Starlake is increasingly establishing itself as a new office cluster in Hanoi.Key developments for grade B in 20252026 include Pearl Tower(SSG Group),Rox Tower(Rox Group),and The Marc 88(Hai Son Company).CBD rents are forecast to rise modestly.Non-CBD rents will likely see increases due to new,premium buildings;however,substantial upcoming supply will limit project-level rent growth.Trang Le|Historical supply and demand trendsFinancial and physical indicators are for the Grade A&B.Data is on an NLA basis.FundamentalsYTD net absorption24,500 s.m.YTD completions8,400 s.m.Vacancy rate15.5%Gross asking rent USD 25.2 p.s.m.p.m.Rent growth Y-o-Y1.8%Stage in rental cycleGrowth Slowing0%2%4%6%8040608010012014016018020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateHo Chi Minh City Jones Lang Lasalle IP,Inc.2025High-quality and well-located offices continue to outperform the market.One Grade B building enter the market.Gross asking rent remains resilient.ResearchHo Chi Minh CityOffice|Q2 2025Despite economic headwinds,the Grade A CBD office market recorded positive absorption of around 8,500 sqm,led by Asia-based firms in premium locations.In the non-CBD,a Japanese logistics company drove approximately 6,000 sqm of take-up by setting up its IT hub in HCMC.Grade B demand was driven by leasing activity in CBD buildings and a large take-up recorded by a school in the South,contribute to 2,800 sqm.Vacancy rates in Grade A segment continuously fell to 13.6%in Q2 2025,a 244.5 bps decline q-o-q,driven by the healthy levels of leasing volume and lack of new supply.Meanwhile,the debut of Halo Signature Building(15,535 sqm)temporarily pushed the Grade B vacancy rate up to 11.6%in Q2,compared to 10.6%in Q1.Gross asking rents remained stable across both segments in Q2 2025,averaging USD 53.1 per sqm per month in the CBD and USD 28.4 per sqm per month in non-CBD areas.Amid market instability,landlords prioritized competitive pricing to attract tenants.In the Grade A segment,CBD capital values held firm at USD 9,155 per sqm.Market yield for this segment remained stable q-o-q at 6.5%but rose 20 bps y-o-y,reflecting the lingering impact of broader economic conditions on investor sentiment.OutlookIn 2025,the market will welcome Marina Central Tower,one of the citys largest office complexes with 71,500 sqm NLA.As large new space become available,existing properties may need to adjust their rents and/or upgrade their facilities to remain competitive.Demand for high-standard,sustainable Grade A office space will still be high as MNCs explore HCMC as their regional and global tech support hub.Grade B leasing activity remained subdued in 2H25 ahead of the anticipated launch of Hong Fu Plaza Tower(20,000 sqm NLA)in 2026.Trang Le|Historical supply and demand trendsFinancial and physical indicators are for the Grade A&B.Data is on an NLA basis.FundamentalsYTD net absorption43,100 s.m.YTD completions15,500 s.m.Vacancy rate12.2%Gross asking rent USD 42.3 p.s.m.p.m.Rent growth Y-o-Y-0.3%Stage in rental cycleGrowth Slowing0%2%4%6%8040608010012014020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateDelhi Jones Lang Lasalle IP,Inc.2025Office Demand Surges in Delhi NCR:Q2 2025 Leasing Reaches 4.2 mn sqft,up 9%Y-o-Y.New Supply infusion of 1.6 million sq ft in Delhi NCR.Delhi NCR sees marginal rental uptick on quarter-on-quarter basis.ResearchDelhiOffice|Q2 2025In Q2 2025,Delhi NCR office take-up reached 4.2 mn sqft.IT/ITeS(23%)remains the primary demand driver,with flexible workspaces(20%)showing strong growth and BFSI(18%)demonstrating sustained interest in the market.During Q2 2025,net absorption in Delhi NCR reached 2.3 mn sqft,declining 3%y-o-y and 36%q-o-q.Primarily,net absorption of office spaces was concentrated in two cities-Gurgaon(65%)and Noida(34%).In Q2 2025,Delhi NCRs office market witnessed supply addition of 1.6 mn sq ft,taking the Grade A stock total to 159.5 mn sq ft.Gurgaon led with 75%of new completions,while Noida contributed 22%and SBD Delhi accounted for 3%.Q2 2025 saw five significant supply additions to Delhi-NCRs office market.Prominent amongst them were TRIL Intellion Park Tower 3&4(0.5 mn sq ft each)in Gurgaon,Anthurium Tower A(0.4 mn sq ft)in Noida and Eros Corporate Tower MLCP Block(0.05mn sq ft)in SBD Delhi.Q2 2025:Delhi-NCR saw Grade A office rents increase by 1%q-o-q and 6%y-o-y.Robust leasing activity and pre-commitment volumes have reinforced developer confidence,resulting in price increases for future supply phases.Recent absorption trends signal potential upward pressure on rental values in the short term.The market is experiencing diversified demand from flexible office space providers,technology sector occupiers,and financial services companies.OutlookInstitutional-grade office assets in prime submarkets will lead market performance in terms of both occupancy and rental growth.Net absorption for H2 2025 is expected to remain strong.The office market across Delhi NCR continues its positive performance,characterized by premium development activity&solid occupier demand.As connectivity between submarkets improves,the regions commercial properties are expected to attract high investor interest.Samantak Das|Historical supply and demand trendsNote:Financial and physical indicators are for the Grade A office market.Data is on a GFA basis.FundamentalsYTD net absorption6,007,100 s.f.YTD completions4,451,800 s.f.Vacancy rate20.7%Gross rent INR 88 p.s.f.p.m.Rent growth Y-o-Y5.8%Stage in rental cycleRents Rising0%5 %04681020202021202220232024YTD 2025s.f.(millions)Net absorptionNew supplyVacancy rateMumbai Jones Lang Lasalle IP,Inc.2025Leasing activity softens q-o-q.Record low vacancy despite healthy supply addition.Strong investor appetite drives capital value growth;rents moving up,too.ResearchMumbaiOffice|Q2 2025Gross leasing reached 2.29 million sq ft,down 14.99%q-o-q,amid a period marked by slower decision-making.Leasing activity in Q2 2025 was primarily driven by domestic occupiers,with Navi Mumbai,SBD North and SBD BKC leading the charts.Quarterly net absorption was 1.25 million sq ft,down 10%q-o-q.SBD North led net absorption with 41%,with key deals including ICICI Lombard and Zomato being significant ones for the submarket.The quarter saw 1.12 million sq ft of new supply,mainly in SBD North and Navi Mumbai.SBD North completions included pre-committed space,indicating sustained demand.Vacancy fell to a record low of 11.7%citywide.Despite lower y-o-y net absorption,the vacancy rate decreased by 17 bps,reflecting tight market conditions.Overall rents grew 0.9%q-o-q and 5.8%y-o-y,with Eastern Suburbs,SBD North and SBD BKC experiencing the largest quarterly gains.Capital values outpaced rents,maintaining market appeal for investors targeting both capital appreciation and steady rental income.OutlookWe anticipate strong space take-up in the near-term,as many occupiers are in the final stages of securing spaces,resulting from the delayed delivery of high-quality supply in core office submarkets.Even with a robust supply pipeline,the forecast for healthy net absorption should result in stable vacancy.Occupiers may continue to pursue flexible strategies,balancing premium and cost-effective locations with varied lease structures and evolving needs.Samantak Das|Historical supply and demand trendsNote:Financial and physical indicators are for the Grade A office market.Data is on a GFA basis.FundamentalsYTD net absorption2,645,400 s.f.YTD completions1,635,800 s.f.Vacancy rate11.7%Gross rent INR 145 p.s.f.p.m.Rent growth Y-o-Y5.8%Stage in rental cycleRents Rising0%2%4%6%82345678920202021202220232024YTD 2025s.f.(millions)Net absorptionNew supplyVacancy rateBengaluru Jones Lang Lasalle IP,Inc.2025Q2 office absorption up 58%y-o-y;Bengaluru sees second-highest H1 net absorption ever.New supply of 3.3 million sq ft in Q2 is up 13%q-o-q.Rentals grow 7.3%y-o-y as leading developers set above-market rates in prime submarkets with limited availability.ResearchBengaluruOffice|Q2 2025The SBD submarket dominated absorption,primarily in ORR North and South-East,with large deals(50,000 sq ft)representing 80%of fresh deals.Despite no new supply in these clusters,occupier activity confirmed these submarkets enduring appeal.Q2 GLV reached 7.53 million sq ft,bringing H1 2025 to 11.8 million sq ft-the second consecutive half-yearly gross lease volume above 10 million sq ft.Tech reclaimed the lead with 40%share in leasing activity,increasing its space take-up by 1.6 times from Q1.SBD City led Bengalurus Q2 supply with a 30%share,followed by SBD North,Whitefield,and SBD South.Grade A developers provided over one-third of new supply,highlighting the markets continuing focus on sustainability and modern workplace features.Office market vacancy rose slightly by 60 bps to 12.0%in Q2 driven by the substantial new supply.Submarkets with new inventory saw rising vacancies,while CBD and Electronic City showed reduced rates,indicating consistent city-wide absorption.Bengalurus office market shows a strong shift toward quality enhancement with developers pursuing green certifications through property upgrades.This sustainability focus resulted in rental appreciation for environmentally certified buildings across submarkets.Capital values increased by 9.6%y-o-y as investor interest remained healthy for high-quality assets with strong tenant profiles.Portfolio deals are being looked at,indicating growing investment interest in the citys office assets.OutlookTech dominates office demand,but manufacturing,fintech,and co-working sectors are growing.Future expansion spans across manufacturing,healthcare/biotech,financial services,flex spaces,engineering R&D,and select IT firms responding to evolving workplace trends.Bengalurus office market absorbs new supply while maintaining rent growth,fostering a positive investment climate.Capital values should continue rising as demand persists amid strong fundamentals and growth prospects attracting domestic and international investment.Samantak Das|Historical supply and demand trendsNote:Financial and physical indicators are for the Grade A office market.Data is on a GFA basis.FundamentalsYTD net absorption6,682,500 s.f.YTD completions8,494,700 s.f.Vacancy rate12.0%Gross rent INR 97 p.s.f.p.m.Rent growth Y-o-Y7.3%Stage in rental cycleRents Rising0%2%4%6%84681012141620202021202220232024YTD 2025s.f.(millions)Net absorptionNew supplyVacancy rateChennai Jones Lang Lasalle IP,Inc.2025Net absorption up by 30%q-o-q.Completions in Q2 total 1.19 million sq ft.Rents and Capital values rose marginally q-o-q.ResearchChennaiOffice|Q2 2025Gross office leasing rose 5%q-o-q in Q2 2025 to 1.99 million sq ft,fueled by strong occupier demand.This pushed H1 2025 leasing to 3.89 million sq ft,signaling a robust year for the office market.Demand was driven by BFSI with a 38%share,followed by IT/ITeS with 25%and Co-working providers with 18%.Net absorption jumped by 30%q-o-q to 1.3 mn sqft,with SBD OMR and PBD OMR submarkets together accounting for 80%of Q2 figures.Five projects including DLF Downtown Block 3,RMM Palmgrove,Casagrand Ecotech-refurbished,Olympia Crystal and Kochar Kush across all major submarkets combined to add 1.8 million sq ft to the citys Grade A stock.In Q2 2025,61%of the new supply was pre-committed.New supply for H1 2025 totalled 1.8 million sq ft,near similar to H1 2024.City vacancy rates rose 50 bps q-o-q to 7.2%,but was still lower by 240 bps y-o-y.PBD GST saw the highest rent growth in Q2 2025 at 9.3%Y-o-Y.SBD OMR rents increased 8.1%Y-o-Y,driven by new premium properties and rental hikes in existing quality assets.Capital values rose as well,growing at 3.2%y-o-y and in line with rents.Consequently,yields remained unchanged.OutlookFor the 2025-2026 period,the Chennai Grade A office market is anticipated to see around 9 million sq ft of new suppl with PBD OMR and SBD projected to contribute two-thirds of this total.Robust demand driven by GCCs within the technology,manufacturing/engineering,and BFSI sectors,as well as flex and technology firms is expected to support an increase in net absorption levels.Samantak Das|Historical supply and demand trendsNote:Financial and physical indicators are for the Grade A office market.Data is on a GFA basis.FundamentalsYTD net absorption2,331,400 s.f.YTD completions1,830,400 s.f.Vacancy rate7.2%Gross rent INR 74.8 p.s.f.p.m.Rent growth Y-o-Y3.4%Stage in rental cycleRents Rising0%2%4%6%823456720202021202220232024YTD 2025s.f.(millions)Net absorptionNew supplyVacancy ratePune Jones Lang Lasalle IP,Inc.2025Robust gross leasing in Q2 is a 33%y-o-y increase.Record-breaking quarterly supply addition in Q2 moves vacancy up 290 bps q-o-q.Overall rents up marginally q-o-q.ResearchPuneOffice|Q2 2025Quarterly gross leasing hit 1.79 million sq ft in Q2,predominantly driven by GCCs,which accounted for 66.4%of the total activity.By sector,Manufacturing/Industrial led with 66.3%,followed by Flex at 17.8%and Tech at 11.1%.The net absorption for the quarter was recorded at 1.0 million sq ft,up by 18%y-o-y.The eastern cluster in the SBD witnessed the most net absorption.On the other hand,the CBD and Suburbs witnessed negative absorption due to withdrawals and exits.New completions reached a record-breaking quarterly high of 4.21 million sq ft across four projects in SBD East.The new supply additions in the quarter continued to outpace net absorption,resulting in the citys overall vacancy increasing to 18.5%.Overall city-level gross rents were up marginally by 1.1%q-o-q.At the submarket level and on a y-o-y basis,gross rents in the CBD increased the most,while the SBD submarket saw marginal growth in rents y-o-y on account of reduced rents in select projects.The capital values rose 1.2%q-o-q and 4.9%y-o-y with yields dropping marginally in the CBD.OutlookBy end-2025,supply is expected to be at record levels of 9-10 million sq ft,primarily in the SBD submarket.Tech,flex space providers and manufacturing/industrial sectors will continue to dominate office space demand in the near-term.High pre-commitment levels for 2025 completions,especially in the SBD,will support net absorption,likely at record levels.Samantak Das|Historical supply and demand trendsNote:Financial and physical indicators are for the Grade A office market.Data is on a GFA basis.FundamentalsYTD net absorption2,020,700 s.f.YTD completions6,623,200 s.f.Vacancy rate18.5%Gross rent INR 82 p.s.f.p.m.Rent growth Y-o-Y3.2%Stage in rental cycleRents Rising0%3%6%9!23456720202021202220232024YTD 2025s.f.(millions)Net absorptionNew supplyVacancy rateKolkata Jones Lang Lasalle IP,Inc.2025Kolkata office market witnesses growth in occupier demand in Q2 2025.No new office spaces become operational in Q2 2025.Quality office spaces continue to drive an uptick in rents across submarkets.ResearchKolkataOffice|Q2 2025In the quarter,office space net absorption of nearly 0.29 million sq ft was recorded.Net absorption increased by 3.1%on a q-o-q basis but went down by 66.5%on a y-o-y basis.The Rajarhat submarket accounted for 95%of the total net absorption.IT&ITES firms drove 56%of the leasing,followed by consultancy businesses with 21%.No new office supply caused the vacancy to drop by 100 bps to 15.2%on a q-o-q basis.Rajarhat saw a 270 bps quarterly drop in vacancy to 9.4%.The overall office stock remained stagnant at 29.6 million sq ft due to a lack of new office supply infusion in any submarket.Healthy demand and low vacancy have led to a 1.9%q-o-q and 12.9%y-o-y growth in rent.During the quarter,the Salt Lake submarket saw the highest uptick in rent by 3%q-o-q,followed by Rajarhat,where rents increased by 1.7%.OutlookThree new office spaces across the CBD and Rajarhat submarkets are likely to be completed in the upcoming quarters of 2025.The introduction of new supply is likely to drive demand for office spaces.The leasing activity across co-working operators and IT&ITES is expected to drive growth in the coming quarters of 2025,which will support rent growth.Samantak Das|Historical supply and demand trendsNote:Financial and physical indicators are for the Grade A office market.Data is on a GFA basis.FundamentalsYTD net absorption566,500 s.f.YTD completions251,200 s.f.Vacancy rate15.2%Gross rent INR 68 p.s.f.p.m.Rent growth Y-o-Y11.5%0%5 %0220202021202220232024YTD 2025s.f.(millions)Net absorptionNew supplyVacancy rateHyderabad Jones Lang Lasalle IP,Inc.2025Leasing activity recorded at 1.69 million sq ft in Q2 2025.Supply additions recorded in both Hitec City and Gachibowli submarkets in Q2.Hitec City submarket continues to show strong rental growth.ResearchHyderabadOffice|Q2 2025The Hyderabad office market recorded gross leasing of 1.69 million sq ft in Q2 2025,reflecting continued strong demand in the market.The Q2 leasing was dominated by IT/ITeS(36.2%),followed by Flex operators(16.5%),and BFSI(15.5%).Net absorption rose 8.5%y-o-y to 1.66 million sq ft,with Hitec City(67.5%)and Gachibowli(31.3%)dominating the market.With three new completions,a total supply of 3.36 million sq ft added fresh inventory to the market,entirely concentrated in the western IT corridor with Hitec City contributing 1.96 million sq ft(58%)and Gachibowli adding 1.4 million sq ft(42%).The overall vacancy rate in Q2 2025 increased by 60 bps q-o-q to 26.3%,due to significant new supply entering the market during the quarter,which outpaced absorption activity.Rents increased in Hitec City as tightening vacancy in quality assets and strong occupier demand is fuelling the surge in rents.Rents were otherwise unchanged across other submarkets.Capital values at the overall city level kept pace with rents,keeping the yields steady.OutlookAn annual supply of 13-14 million sq ft is anticipated in the near future,with Gachibowli facing potential oversupply.Hitec City is likely to maintain lower vacancy rates due to strong tenant demand.Strong market activity is expected to persist due to ongoing demand from various sectors including IT/ITeS,BFSI,manufacturing,healthcare,and flexible workspace operators.Samantak Das|Historical supply and demand trendsNote:Financial and physical indicators are for the Grade A office market.Data is on a GFA basis.FundamentalsYTD net absorption3,835,900 s.f.YTD completions4,887,500 s.f.Vacancy rate26.3%Gross rent INR 75 p.s.f.p.m.Rent growth Y-o-Y16.3%Stage in rental cycleRents Rising0%5 %010152020202021202220232024YTD 2025s.f.(millions)Net absorptionNew supplyVacancy rateSydney Jones Lang Lasalle IP,Inc.2025The Sydney CBD records positive leasing demand for the sixth consecutive quarter.Sydney CBD stock increased to 5,393,200 sqm due to multiple completions over the quarter.Prime yields are unchanged over the quarter across the Sydney office markets.ResearchSydneyOffice|Q2 2025The Sydney CBD recorded 23,500 sqm of positive net absorption over Q2 2025.This was driven mainly by large tenant(1,000 sqm)demand as tenants increased their leasing requirements over the quarter.Seven out of the ten Sydney office markets recorded positive net absorption over Q2 2025.The strongest result in the non-CBD markets was Sydney South,which recorded 16,800 sqm of net absorption while the weakest result was in Macquarie Park(-10,100 sqm).There were three completions totalling 46,900 sqm over the quarter and no withdrawals in the CBD.There is 198,200 sqm of stock under construction across eight projects with delivery between Q3 2025 and Q4 2027.There was one completion in the non-CBD office markets.68 Alfred Street South,Milsons Point(4,700 sqm)completed over the quarter.There is currently 140,200 sqm under construction in the non-CBD markets.Sydney CBD Core prime net face rents grew 0.8%over the quarter and by 6.0%over the year to average AUD 1,492 per sqm p.a.Prime incentives reduced slightly to 33.0%.The reduction in incentives was mainly driven by Premium Grade stock in the Core.Rental performance in the non-CBD metro markets was negative over the quarter,as face rents remained mostly flat while prime incentives continued to increase.As a result,net effective rents have been flat or negative.OutlookThe Sydney CBD vacancy rate is forecast to continue gradually trending downwards over 2025 as major supply completions are limited to 270 Pitt Street(22,700 sqm)while tenant demand remains steady.The Sydney metro markets development pipeline continues to shrink,as increases in construction costs and elevated vacancy rates have pushed projects out into later years or changed their use to alternative uses.Lucas Byrne|Historical supply and demand trendsNote:Financial indicators are for the CBD Prime office market,while physical indicators are for the CBD office market(all grades).Data is on an NLA basis.FundamentalsYTD net absorption29,500 s.m.YTD completions46,900 s.m.Vacancy rate15.6%Gross effective rent AUD 1,048 p.s.m.p.a.Rent growth Y-o-Y9.1%Stage in rental cycleRents Rising-30%-20%-10%0 %-300-200-100010020020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateMelbourne Jones Lang Lasalle IP,Inc.2025Demand recovery strengthens in Melbourne CBD.Minimal completions recorded in Melbournes CBD and Fringe markets.CBD effective rents display growth.ResearchMelbourneOffice|Q2 2025The Melbourne CBD recorded positive net absorption of approximately 11,900 sqm this quarter.Demand was primarily driven by small tenant moves(1,000 sqm).No major completions were recorded over the quarter in the Adelaide CBD.There are currently two projects under construction in the supply pipeline,totalling 42,700 sqm,and two projects with plans approved,totalling 52,300 sqm.A 21,000 sqm office tower developed by Kyren Group at 50 Franklin Street is set to be completed in Q3 2025.Additionally,ICD Property is developing the 21,700 sqm Market Square Office Tower on Grote Street,anticipated to be completed by Q3 2026.Average prime net face rents decreased 0.2%over the quarter to AUD 492 per sqm p.a.but reflected year-on-year growth of 1.8%.Average prime net effective rents decreased 1.6%to AUD 188 per sqm p.a.,with year-on-year growth declining 1.3%.Average prime midpoint yields were stable at 7.75%over the quarter.There remains a spread between buyer and vendor expectations,but this gap has narrowed over the past 12 months.Average prime midpoint yields were also stable on an annual basis.OutlookNear-term demand levels are expected to be supported by businesses expanding and centralising to the Adelaide CBD.It is also expected that preference will remain for quality prime stock.Investors are likely to remain selective in terms of potential acquisitions due to broader global economic uncertainty.Prime office yields have reached the end of the softening cycle and are forecast to be stable throughout 2025.Helen Ye|Historical supply and demand trendsNote:Financial indicators are for the CBD Prime office market,while physical indicators are for the CBD office market(all grades).Data is on an NLA basis.FundamentalsYTD net absorption11,100 s.m.YTD completions0 s.m.Vacancy rate14.8%Gross effective rent AUD 328 p.s.m.p.a.Rent growth Y-o-Y2.7%Stage in rental cycleGrowth Slowing-8%-4%0%4%8 $%-40-2002040608010012020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateCanberra Jones Lang Lasalle IP,Inc.2025Net absorption remains positive for fourth consecutive quarter,with sustained leasing activity across market segments.Headline vacancy rate stabilizes;prime vacancy declines while secondary and sublease vacancies increase.Prime and secondary rents show modest changes;yields unchanged while incentives rise.ResearchCanberraOffice|Q2 2025In Q2 2025,Canberra experienced a net absorption of around 6,700 sqm,marking the fourth consecutive positive quarter for Canberra.Additionally,positive net absorption was recorded for both prime(4,300 sqm)and secondary(2,400 sqm)markets.The 10-year average net absorption stands at 5,000 sqm,and the total net absorption over the last 12-months reached 37,800 sqm.These metrics indicate a sustained period of demand and leasing activity in the Canberra market during this period.In Q2 2025,Canberras headline vacancy rate saw a slight reduction of 0.1 percentage points(pps)from the previous quarter dropping to 9.1%.The prime vacancy rate saw a fall of 0.3 pps to 7.8%.Conversely,the secondary vacancy rate increased by 0.4 pps,to 11.8%.Sublease vacancy also experienced a rise,increasing by 0.2 pps,from 0.8%in the previous quarter to 1.0%.Overall,the trends indicate a stabilization in the headline vacancy rate alongside contrasting movements in the prime and secondary markets.Prime net effective rents reduced by 0.8%over the quarter to AUD 262 per square meter p.a.,an increase of 2.3%year-on-year,up from AUD 256 in Q2 2024.Prime incentives have increased 0.4 pps to 27.5%.Secondary net effective rents increased by 0.1%over the quarter to AUD 170 per square meter p.a.,however they remain of 2.6%down year-on-year,from AUD 175 in Q2 2024.Secondary incentives have increased 0.2 pps to 28.1%.OutlookHeadline vacancy is expected to continue to recover slightly over the remainder of 2025 as completed stock is absorbed,however,vacancy is expected to increase over the medium-term as the number of major projects reach completion.In line with headline vacancy,incentives are expected to increase as available stock increases.Sam Vaughan|Historical supply and demand trendsNote:Financial indicators are for the CBD Prime office market,while physical indicators are for the CBD office market(all grades).Data is on an NLA basis.FundamentalsYTD net absorption7,400 s.m.YTD completions35,200 s.m.Vacancy rate9.1%Gross effective rent AUD 359 p.s.m.p.a.Rent growth Y-o-Y3.1%Stage in rental cycleRents Rising-4%-2%0%2%4%6%8%-30030609012015020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateAuckland Jones Lang Lasalle IP,Inc.2025Clear preference for quality and location.Increase in supply will provide more occupier options.Increases in face rents for better quality and location of office space.ResearchAucklandOffice|Q2 2025The overall Auckland CBD vacancy rate increased by 130 bps to 16.5%,representing vacant space of 225,100 sqm across all grades.Prime and secondary office space increased to 12.7%( 250 bps)and 21.7%( 120 bps),respectively.This is above the long-term averages and reflective of the wider economic environment.Total office accommodation in the Auckland CBD increased to 1.37 million sqm( 30,800 sqm)during 2024.By contrast,total supply was relatively stable between 2013 to 2022 with new construction balanced by secondary stock removed due to obsoletion or change of use.A major completion included two buildings along with an annexure at Precinct Properties Wynyard Phase 3 development.These provide a net leasing area of 19,700 sqm of premium office space in total.After remaining unchanged for three consecutive quarters,the CBD prime average net rents increased this quarter,albeit marginally,by 1.2%,to now stand at NZD 613 per sqm,p.a.Four Auckland CBD office buildings at 22,24 and 26 Durham Street West and 19 Victoria Street West,including the former Finance Centre,was sold by Bei Group and purchased by Quattro Group in July 2025 for AUD 104 million.OutlookThe market has experienced an increase in vacancy rates during the first half of the year,now at 15.1%for the overall city and at 16.5%for the CBD.This rise in vacancy is not indicative of a pronounced market downturn.Rather,it reflects new,high-quality developments coming on stream,as well as businesses continuing to re-evaluate their space needs in a post-pandemic environment.Hina Uqaili|Historical supply and demand trendsNote:All indicators are for the CBD market(all grades).Data is on an NLA basis.FundamentalsYTD net absorption8,900 s.m.YTD completions30,800 s.m.Vacancy rate16.5%Net rent NZD 613 p.s.m.p.a.Rent growth Y-o-Y1.6%Stage in rental cycleGrowth Slowing-15%-10%-5%0%5 %-60-40-2002040608020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rateWellington Jones Lang Lasalle IP,Inc.2025Vacancy expected to increase as refurbishment projects complete.Increase in supply expected over the next two years.Stability in rents as occupier options rise.ResearchWellingtonOffice|Q2 2025The overall vacancy rate increased to 15.0%from 8.8%( 620 bps)for Q2 2025.This comprises a prime vacancy rate of 7.2%( 220 bps as compared with Q4 2024)and a secondary vacancy rate of 17.1%( 760 bps as compared with Q4 2024).Less government-sector office demand,combined with various refurbishment projects nearing completion,will likely drive vacancy rates upward across all property grades.We project the overall vacancy rate to reach 17.2%by 2028.Approximately 162,000 sqm of office space is under construction,refurbishment,seismic strengthening or in the planning stages in the capitals CBD.A number of Prime and Secondary buildings are under refurbishment/seismic strengthening,which are expected to complete by 2027.These include 80 The Terrace,96 The Terrace,33 Customhouse Quay,50 Victoria Street,68-86 Jervois Quay and 13-27 Manners Street.Rents across all grades and precincts remained unchanged during the quarter.The CBD core Prime and Secondary average gross rents stand at NZD 751 and NZD 456 per sqm p.a.,respectively.Precinct Properties announced in February that PAG will acquire the remaining 20%minority interest in 40&44 Bowen Street in the Wellington CBD for a total purchase price of AUD 48 million.OutlookThe vacancy rate has edged up to 13.8%from 8.0%,mainly attributed to the governments and private sectors efforts to optimise their workspace commitments.This situation presents opportunities for tenants seeking to upgrade or negotiate more competitive lease terms.An ongoing focus is on operating expenses,especially with rising insurance and local council rate increases in recent years.This is leading to a number of landlords looking to embed a net rather than gross office leasing environment.Hina Uqaili|Historical supply and demand trendsNote:All indicators are for the CBD market(all grades).Data is on an NLA basis.FundamentalsYTD net absorption41,700 s.m.YTD completions7,100 s.m.Vacancy rate13.8%Gross rent NZD 751 p.s.m.p.a.Rent growth Y-o-Y2.8%Stage in rental cycleGrowth Slowing-5%0%5%-40-2002040608010012020202021202220232024YTD 2025s.m.(thousands)Net absorptionNew supplyVacancy rate Jones Lang Lasalle IP,Inc.202537Asia Pacific Roddy Allan Chief Research OfficerAsia Pacific 852 2846 Greater China Hong Kong Cathie Chung Senior Director-Hong Kong 852 2846 China Daniel Yao Head of Research China 86 86 Taiwan Morris Zhao Head of Research-Taiwan 886 976 914 To find out more about JLL services,contact:Macau Mark Wong Director 853 2871 North Asia Japan Takeshi Akagi Head of Research Japan 81 3 5501 South Korea Veronica Shim Head of Research Korea 82 2 3704 South East Asia Dr Chua Yang LiangHead of Research and Consultancy South East Asia 852 2846 Indonesia Yunus Karim Head of Research-Indonesia 62 21 2922 Philippines Janlo Delosreyes Head of Research Philippines 63 2 902 Thailand Anawin Chiamprasert Head of Research Thailand 66 2 624 Vietnam Trang Le Head of Country and Research Vietnam 84 8 3910 Malaysia Yulia Nikulicheva Head of Research andConsultancy Malaysia 60 19 226 South Asia India Dr Samantak Das Head of Research India 91 22 6620 Australasia Australia Andrew Ballantyne Head of Research Australia 61 2 9220 New Zealand Chris DibbleHead of Research-New Zealand 64 21 242 Jones Lang Lasalle IP,Inc.202538Research at JLLJLLs research team delivers intelligence,analysis and insight through marketleading reports and services that illuminate todays commercial real estate dynamics and identify tomorrows challenges and opportunities.Our more than 550 global research professionals track and analyze economic and property trends and forecast future conditions in over 60 countries,producing unrivalled local and global perspectives.Our research and expertise,fueled by real-time information and innovative thinking around the world,creates a competitive advantage for our clients and drives successful strategies and optimal real estate decisions.About JLLFor over 200 years,JLL(NYSE:JLL),a leading global commercial real estate and investment management company,has helped clients buy,build,occupy,manage and invest in a variety of commercial,industrial,hotel,residential and retail properties.A Fortune 500 company with annual revenue of$23.4 billion and operations in over 80 countries around the world,our more than 112,000 employees bring the power of a global platform combined with local expertise.Driven by our purpose to shape the future of real estate for a better world,we help our clients,people and communities SEE A BRIGHTER WAYSM.JLL is the brand name,and a registered trademark,of Jones Lang LaSalle Incorporated.For further information,visit .COPYRIGHT JONES LANG LASALLE IP,INC.2025This report has been prepared solely for information purposes and does not necessarily purport to be a complete analysis of the topics discussed,which are inherently unpredictable.It has been based on sources we believe to be reliable,but we have not independently verified those sources and we do not guarantee that the information in the report is accurate or complete.Any views expressed in the report reflect our judgment at this date and are subject to change without notice.Statements that are forward-looking involve known and unknown risks and uncertainties that may cause future realities to be materially different from those implied by such forward-looking statements.Advice we give to clients in particular situations may differ from the views expressed in this report.No investment or other business decisions should be made based solely on the views expressed in this report.
2025-08-22
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August 2025China Retail Property MarketResearch Report 1H2025Retail ResearchDespite a June slowdown in catering(growth receding to 0.9%YoY,a post-2023 recovery low),Chinas consumer macro data showed broad stability in H1 2025,with total retail sales reaching CNY 24.5 trillion( 5.0%YoY,accelerating 0.4 ppts from Q1).Merchandise retail( 5.1%)surpassed catering revenue( 4.3%)for the first time in recent years.Government subsidies drove significant out-performance in household appliances&AV equipment( 30.7%y-o-y)and culture/office supplies( 25.4%,y-o-y),while telecom,furniture,and sports/entertainment sectors all exceeded 20%growth.Conversely,automobiles( 0.8%),apparel and footwear( 3.1%),and cosmetics( 2.9%)remained sluggish,signaling caution for retail property demand.The 618 festival lifted online sales growth to 8.5%,narrowing the offline-online growth gap a positive signal for physical retail with e-commerce penetration rebounding to 24.9%.Holiday tourism revenue grew nearly 10%,supported by record inbound tourism from visa-free countries.In the first half of this year,new supply additions across 21 major Chinese cities totaled 2.1 million sqm,representing a 27.5%y-o-y decline,signaling that Chinas prime retail property market has entered a phase of supply-side deceleration;tier-1 cities accounted for a dominant 61.0%share of this supply(with Beijing and Shenzhen ranking as the top two contributors),reflecting the strategic refocusing of commercial development toward high-tier cities amid risk pressures.According to statistics from 40 major cities,the top 30 leading developers now command over 50%market share,continuing their dominance in retail development.Despite this contraction in new supply,the average vacancy rate continued to climb,increasing by 0.3 ppts to 10.5%during H1 according to JLL data.Breaking down by city tier:Tier-1 cities saw vacancies rise by 1.1 ppts to 8.4%,primarily driven by concentrated project completions;Tier-1.5 cities stabilized at 10.8%;while Tier-2 cities recorded a marginal decline of 0.1 ppts to 12.1%.Near-term projections indicate that Chinas retail property vacancy rates are approaching cyclical peaks and may begin declining within 12 months.Incremental retail demand remains constrained by dual pressures:structural shifts and a tightening fundamental base.On one hand,tenant demand is pivoting from high-rent categories toward low-rent operators,driving structural erosion in overall rents;simultaneously,retailers face weakened affordability due to compressed sales volumes,further reducing percentage of rental turnover incomes.Consequently,prime ground-floor rents across these 21 cities contracted by 2.8%YTD H1 2025 on average,with Q2s drop exceeding that of Q1.03 03 3637Despite prevailing market caution,emerging opportunities are crystallizing as Chinas retail property vacancy rates stabilize.Four transformational shifts are reshaping retail dynamics as follows:1.Demographic Adaptiveness:Expectations of volatile economy have compressed household spending within a dumbbell-shaped family structure(aging parents single millennials),suppressing demand for child-centric offerings.Conversely,the unmarried consumers are growing and fueling robust expansion of companionship-driven consumption.2.Value Recognition:Luxury sales softened,though polarizing performances emerged.Top brands are now launching flagships to retain high-net-wealth VICs.Meanwhile,the cultural-toy economy epitomized by pop-up collectibles surged as Gen-Zs premium outlet of emotional consumption,while C2M(Customer-to-Manufacturer)models and brand/tag-free goods gained dominance via live-streaming commerce,disrupting conventional brand hierarchies.3.Retail Place Making:Retail spaces now prioritize dwell-time expansion through experiential engagement,transitioning from transactional arenas to social destinations.While this lengthens customer stays,it reduces per-customer transaction efficiency.Operators compensate by extending business hours,and nighttime economies now offsets daytime traffic declines.4.Home-grown Retailer Power:Chinas retail brand power is undergoing a pivotal transformation,shifting from foreign-driven fashion influences toward the explosive rise of guochao(Chinese-trendy)brands.This realignment sees domestic players accelerating penetration across all retail categories.Their ascendancy not only demonstrates Chinas burgeoning global innovation and design influence but also reveals the retail supply chains remarkable adaptability.Looking ahead to 2025,Chinas 21 major cities are projected to deliver approximately 8 million sqm of new retail supply,broadly flat or slightly down y-o-y.Actual completions will likely fall below 7 million sqm pipeline,due to tough challenges confronting retail preleasing.This marks the onset of a three-year supply ebb phase for Chinas retail property sector,redirecting development focus back to Tier-1 and Tier-1.5 commercial hubs.Consequently,with new pipelines receding,average market vacancy is expected to peak by late-2025 before commencing a gradual decline from 2026 onward,catalyzing tangible sentiment improvement.Crucially,Tier-1 cities will spearhead the recovery cycle,with rents forecasted to bottom out and rebound by 2027,paving the way for national rent stabilization in 2028.JLL Retail ResearchContents01 EconomyTraffic06Retail Sales08Online Retail Sales12Tourism&Holiday 14Consumer Sentiment16Consumption Contribution17CPI18Income&Expenditure1902 Property MarketData Overview23Top 40 Cities24SupplyAnalysis26Vacancy Analysis31Supply-Demand33Retail Rental3403 Retail TrendsLeasingOverview36Tenants Overview37Trends38Demographic Adaptiveness39Value Recognition40Retail Place Making41Home-grown Retailer Power4204 Market ResponsePolicy44Operator45Investment46Tri-angle Summary4805 OutlookSupply Outlook50Vacancy Outlook52Rental Outlook53Capital Market54Outlook552025China Retail Property Market Research Report 1H 202527.6%-25.2H.5%5.8%2.27.6%-13.8B.2%7.8%3.4F.0%-17.4.6.6.1%-40%-20%0 0 212022202320242025H120212022202320242025H120212022202320242025H1City Traffic:Subway traffic growth rebounded in 1H25024681012DalianXiamenKunmingQingdaoTianjinShenyangSuzhouZhengzhouChangshaNanjingWuhanXianChongqingChengduShenzhenGuangzhouBeijingShanghaiMillion PassengersType A CitiesType A CitiesType B CitiesType C CitiesType B CitiesType C CitiesDaily subway ridership growth(YoY)Daily subway ridership in key Chinese cities(2025H1)Note:Type A cities include Beijing,Shanghai,Guangzhou,Shenzhen;Type B cities include Chengdu,Wuhan,Suzhou,Chongqing,Hangzhou,Nanjing;Type C cities include Changsha,Zhengzhou,Tianjin,Xian,Shenyang,Qingdao,Ningbo,Wuxi,Xiamen,Dalian,Kunming.6|2025Jones Lang LaSalle IP,Inc.All rights reserved.Sources:iFind Data,JLL Research,August 2025China Retail Property Market Research Report 1H 20253375.03660.02203.52611.71673.03854.54312.42235.89.4%8.4%-39.8.5%-35.90.4.9%6.7%-50%0P00,5003,0004,5006,00020182019202020212022202320241H2025Million PassengersRailway Traffic(LHS)y-o-y(RHS)1265.01352.0857.0907.0520.01259.61460.0738.010.2%6.9%-36.6%5.9%-42.72.2.9%5.0%-100%-50%0P00006009001,2001,50020182019202020212022202320241H2025Million PassengersAir Traffic(LHS)y-o-y(RHS)Intercity Traffic:Growth narrowed in both air and rail passenger traffic in 1H25China air passenger traffic/yoyChina railway passenger traffic/yoySources:Official Websites of Urban Rail Transit in Various Cities,JLL Research,August 20257|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 20259.2%9.1.9.5%1.7%1.0%3.7%4.6%6.5%8.0%4.8%4.6%2.7%2.0%3.6%1.5%2.7%1.9%3.3%5.0%2.8%3.9%3.9%5.9%5.1%6.5%5.3%2.9&.3C.85.1.1.8.4.8.1%.80.0.5%6.9%4.4%5.0%5.4%3.0%3.3%3.1%3.2%4.0%2.7%4.3%5.6%5.2%5.9%0.9%0%5 %05EP%1-2M233M234M235M236M237M238M239M2310M2311M2312M231-2M243M244M245M246M247M248M249M2410M2411M2412M241-2M253M254M255M256M25Retail Sales of GoodsCatering Revenue8.0%-3.9.5%-0.2%7.2%3.5%5.0%-6%-4%-2%0%2%4%6%8 19202020212022202320242025 H1Retail Sales:Growth rebounded,retail sales of goods exceeding catering for the first timeChina annual retail sales y-o-yChina monthly retail sales y-o-y:Consumer Goods vs CateringSources:National Statistics Bureau,JLL Research,August 20258|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 2025-30%-20%-10%0 0,0002,0003,0004,0005,0006,0001 2 3 4 5 6 7 8 9 101112 1 2 3 4 5 6 7 8 9 101112 1 2 3 4 5 6 7 8 9 101112 1 2 3 4 5 6 7 8 9 101112 1 2 3 4 5 6 7 8 9 101112 1 2 3 4 5 6 7 8 9 101112 1 2 3 4 5 62019202020212022202320242025Billion YuanRetail Sales(LHSy-o-y(0,RHS)y-o-y(0,RHS)Retail Sales:Growth rebounded in Q2 and achieved an 18-month high in MayChina monthly retail sales and yoyNote:The current values for January and February are the average of the cumulative values for January-February.9|2025Jones Lang LaSalle IP,Inc.All rights reserved.Sources:National Statistics Bureau,JLL Research,August 2025China Retail Property Market Research Report 1H 2025Sources:National Statistics Bureau,JLL Research,August 2025Retail Sales:Govt subsidy fostered the sales in household appliances and electronicsChina retail sales 1H YTD and y-o-yRetail SectorYTD 1H 2025(billion)1H 2025 y-o-y(%)1H 2024 y-o-y(%)1H 2023 y-o-y(%)Automobile2,347 0.8-1.16.8Grain,Oil,and Food Foodstuff1,195 12.39.64.8Petroleum and Related Products1,172 -3.44.17.5Garments,Footwear,Hats,Knitwear743 3.11.312.8Household Appliances and Video Equipment609 30.73.11.0Communication Appliances489 24.111.34.1Commodities432 7.32.35.0Traditional Chinese and Western Medicines361 1.44.411.1Tabacco and Liquor332 5.510.08.6Cultural and Office Appliances240 25.4-5.8-3.9Cosmetics229 2.91.08.6Gold and Silver Jewelry195 11.30.217.5Beverages162 -0.65.61.0Furniture98 22.92.63.8Sports and Recreational Articles86 22.211.210.5Building and Decoration Materials82 2.6-1.2-6.710|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 2025North-3.8%7.4%Total retail sales growth across major Chinese cities,2025H10100200300400500600700800900DalianKunmingXiamenShenyangWuxiNingboChangshaXianQingdaoZhengzhouWuhanNanjingHangzhouSuzhouShenzhenGuangzhouChengduBeijingShanghaiChongqingBillion Yuanx 105.3%Nanjing2.1%Qingdao5.6%Changsha7.3%Wuhan3.5%Shenzhen5.9%Nanjing6.1%Chengdu6.6%Zhengzhou4.1%Kunming4.5%Kunming6.7%Xian-0.7%TianjinDalian7.4%6.5%XiamenHangzhou6.0%2.2%NingboShanghai1.7%Suzhou3.8%Wuxi4.7%Note:Tianjin only released the growth rate data of the total retail sales of consumer goods.11|2025Jones Lang LaSalle IP,Inc.All rights reserved.Source:Statistical Bureaus of respective cities,JLL Research,August 2025Total retail sales across major Chinese cities,2025H1Type A CitiesType B CitiesType C CitiesBeijing-3.8%Shenyang6.0%Retail Sales:Chongqing outnumbered Shanghai,Beijing&Tianjin decliningChina Retail Property Market Research Report 1H 2025-4%-2%0%2%4%6%8%1-2M223M224M225M226M227M228M229M2210M2211M2212M221-2M233M234M235M236M237M238M239M2310M2311M2312M231-2M243M244M245M246M247M248M249M2410M2411M2412M241-2M253M254M255M256M25Growth GapOnline Retail Sales YTD y-o-yRetail Sales YTD y-o-yOnline Retail Sales:Growth gap narrowed,offline sales catching upOnline and total retail sales growth trends in China(YTD,y-o-y)Source:National Bureau of Statistics,JLL Research,August 202512|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 2025117,601130,884137,853154,264155,22574,29510.9.1%4.0.0%7.2%8.5#.6$.5.2.6&.8$.9%0%5 %050,00040,00060,00080,000100,000120,000140,000160,000202020212022202320242025H1Billion YuanOnline Retail Sales(LHS)y-o-y(RHS)%/Retail Sale(RHS)30.90.6.8.1.2.0.7.4%5.8%8.3%3.5.8%1.5%1.4.8.2.5%5.7%7.1%6.3%5.3%0%6$06 19202020212022202320242025H1Food ProductsClothing ProductsHousehold ProductsOnline Retail Sales:A declining share of online retail sales in total retail salesOnline retail sales/y-o-y,%of retail salesRetail sales sector-wise y-o-ySource:National Bureau of Statistics,JLL Research,August 202513|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 202515.2.0.9%-28.27.9%-77.0.5%-100%-50%0P00 0%YoY growth in tourism revenue(LHS)3.22.72.31.21.60.62.83.32.72.41.51.91.23.1-2.4-1.4-0.40.61.62.63.6-10-8-6-4-20242025H12024H12023H12022H12021H12020H12019H1Tourism RevenueTourist VisitsTrillion CNY20.6.3c.9%-22.20.8%-62.0%8.8%-80%-60%-40%-20%0 00%YoY growth in tourist visits(RHS)China tourism revenue and tourist arrivalsSources:Ministry of Culture and Tourism,JLL Research,August 202514|2025Jones Lang LaSalle IP,Inc.All rights reserved.Tourism&Holiday:Steady traffic secured a robust growth of revenueBillion touristsChina Retail Property Market Research Report 1H 2025Tourism revenue and y-o-y during Chinas public holidaysNote:Year-on-year growth for Qingming Festival 2024 has not been released.The Mid-Autumn Festival and National Day holidays overlapped in 2023.Year-on-year growth for Mid-Autumn Festival 2024 has not been released.-4000!060320480640800Billion YuanDomestic Tourism Revenue(LHS)y-o-y(RHS)Foreign inbound visitsTourism&Holiday:Inbound arrivals boosted by visa-free policySources:Ministry of Culture and Tourism,National Immigration Administration,JLL Research,August 202515|2025Jones Lang LaSalle IP,Inc.All rights reserved.010,00020,00030,00040,00050,00060,00070,00080,00090,0002023H12024H12025H12023 FY2024 FY2025 FYForecastVisits(thousand)China Retail Property Market Research Report 1H 20253.2%1.0%5.9%0.6%-51.6.1%-37.2%-19.9V.54.7.5%-12.4.2%-6.6%-14.5.2%-80%-60%-40%-20%0 0046810121416182020182019202020212022202320242025H1Trillion YuanNew Household Deposits(LHS)New Household Loans(LHS)New Household Loans y-o-y(RHS)New Household Deposits y-o-y(RHS)China household deposits and loansChina Consumer Confidence Index7080901001101201302021.012021.032021.052021.072021.092021.112022.012022.032022.052022.072022.092022.112023.012023.032023.052023.072023.092023.112024.012024.032024.052024.072024.092024.112025.012025.032025.05Consumer Sentiment:Persistent consumer caution fueled a rise in saving ratesNote:Consumer confidence index data series take the value range of 0-200,100 is the threshold,above 100 means more confident,below 100 means less confident.Sources:PBOC,NBS,JLL Research,August 202516|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 202550%Consumption as%of GDP YTD y-o-y44.0W.6G.4e.7U.4P.2V.3i.0f.0U.9d.0X.6%-6.8X.32.8.5s.7.5I.9D.5Q.7R.3%-20%0 0 082009201020112012201320142015201620172018201920202021202220232024Q12024Q22024Q32024Q42025Q12025Q2Consumption Contribution Rate:Continued a mild recovery in 1H25Note:Data for Q4 2023 and Q4 2024 represent the full-year figures for 2023 and 2024,respectively.Source:National Bureau of Statistics,JLL Research,August 202517|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 2025CPI:Clawed back from low with Juns reading turning positiveCPI(base=100,y-o-y)-2%-1%0%1%2%395100105110115JAN.2022FEB.MAR.APR.MAY.JUN.JUL.AUG.SEPT.OCT.NOV.DEC.JAN.2023FEB.MAR.APR.MAY.JUN.JUL.AUG.SEPT.OCT.NOV.DEC.JAN.2024FEB.MAR.APR.MAY.JUN.JUL.AUG.SEPT.OCT.NOV.DEC.JAN.2025FEB.MAR.APR.MAY.JUN.CPI(LHS)y-o-y(RHS)m-o-m(RHS)Source:National Bureau of Statistics,JLL Research,August 202518|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 2025-15%-10%-5%0%5 ,0008,00012,00016,00020,00024,00028,0002015H12016H12017H12018H12019H12020H12021H12022H12023H12024H12025H1Per Capita Disposable Income(LHS)Per Capita Consumer Expenditure(LHS)Per Capita Disposable Income y-o-y(RHS)Per Capita Consumer Expenditure y-o-y(RHS)Income&Expenditure:Growth converged,making both ends meetChinese per capita income and expenditure/y-o-yNote:All growth rates are real growth rates,adjusted for price factors.Source:National Bureau of Statistics,JLL Research,August 202519|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 2025Income&Expenditure:F&B anchored consumption,edu/ent sectors acceleratingPer Capita Consumer Expenditure and Composition,1H25Per Capita Consumer Expenditure y-o-y,1H25Food,Tobacco and Alcohol,30.4%Housing,21.6%Transport and Communication,13.8ucation,Culture and Entertainment,10.5%Healthcare,9.2%Clothing,5.9%Household Goods and Services,5.6%Other Goods and Services,3.0%2.1%2.9%3.3%3.4%8.4%9.0.4.8%ClothingHousingFood,Tobacco andAlcoholHealthcareTransport andCommunicationHousehold Goods andServicesOther Goods andServicesEducation,Culture andEntertainment20|2025Jones Lang LaSalle IP,Inc.All rights reserved.Source:National Bureau of Statistics,JLL Research,August 20252025China Retail Property Market Research Report 1H 2025Market Coverage:China prime retail marketTop 40 retail citiesShenyangSuzhouWuxiDalianBeijingTianjinQingdaoZhengzhouXianChengduChongqingChangshaWuhanKunmingGuangzhouShenzhenHangzhouNanjingNingboShanghaiXiamenHefeiJinanFuzhouNanchangShijiazhuangChangchunHarbinTaiyuanNanningGuiyangZhuhaiHohhotUrumqiLanzhouYinchuanHaikouSanyaXiningLhasaType A CitiesType C CitiesType B CitiesOtherCitiesChinas tier 1 cities(4)Beijing,Shanghai,Guangzhou,ShenzhenType A CitiesTier 1.5 Cities,GDP Top 10(6)Chengdu,Wuhan,Chongqing,Nanjing,Hangzhou,SuzhouType B CitiesOther tier 1.5 cities and tier 2 cities(11)Xian,Shenyang,Qingdao,Changsha,Ningbo,Tianjin,Zhengzhou,Kunming,Dalian,Xiamen,WuxiType C CitiesProvincial Capitals and Key Cities(19)Hefei,Jinan,Fuzhou,Nanchang,Shijiazhuang,Changchun,Harbin,Taiyuan,Nanning,Guiyang,Zhuhai,Urumqi,Hohhot,Lanzhou,Yinchuan,Haikou,Xining,Sanya,LhasaType D CitiesMajorCitiesOtherCitiesSources:JLL Research,August 2025Note:The city classification used in the following analysis remains consistent.22|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 2025Type A CitiesYoY Vacancy Rate Change:1.1 pptVacancyRate:8.4%Total Stock:47,343,000 sqmNewSupply:1,236,000 sqmType B CitiesYoY Vacancy Rate Change:0.0 pptVacancyRate:10.8%Total Stock:50,623,000 sqmNewSupply:356,000 sqmType C CitiesYoY Vacancy Rate Change:-0.1 pptVacancyRate:12.1%Total Stock:51,923,000 sqmNewSupply:451,000 sqm21 Key Cities(Type A Type B Type C)YoY Vacancy Rate Change:0.3 pptVacancyRate:10.5%Total Stock:148,698,000 sqmNewSupply:2,069,000 sqm40 Cities (Type A Type B Type C Type D)TotalStock:211,389,000 sqmType A CitiesTotalStock(sqm)NewSupply(sqm)VacancyRateYoY Vacancy Rate Change(ppt)Shanghai17,182,000212,00011.9%0.8Beijing16,206,000567,0008.2%1.1Shenzhen8,212,000407,0004.0%1.7Guangzhou5,742,00078,0004.8%0.9Type B CitiesTotalStock(sqm)NewSupply(sqm)VacancyRateYoY Vacancy Rate Change(ppt)Chengdu12,352,00060,00011.5%0.9Wuhan9,606,00024,00013.2%0.1Chongqing8,944,000013.0%-0.5Nanjing6,888,000209,0004.8%0.0Hangzhou6,516,00008.8%-0.9Suzhou6,318,00063,00011.5%0.0Type C CitiesTotalStock(sqm)NewSupply(sqm)VacancyRateYoY Vacancy Rate Change(ppt)Xian7,650,0000 10.6%0.0Shenyang7,109,000100,000 18.1%0.1Qingdao5,862,0000 7.9%-0.2Changsha5,474,0000 11.3%0.7Tianjin4,800,00050,000 12.2%-0.1Zhengzhou4,807,000241,000 11.5%-0.2Ningbo4,477,0000 13.0%0.1Kunming4,311,0000 16.8%0.0Dalian2,636,0000 9.3%0.0Xiamen2,915,00060,000 6.3%-0.1Wuxi1,884,0000 13.3%0.023|2025Jones Lang LaSalle IP,Inc.All rights reserved.Data Overview:China prime retail market dashboard,1H25 Sources:JLL Research,August 2025Note:The vacancy rates for Shenyang and Tianjin are as of 1Q2025;for Suzhou,Xian,Dalian,and Kunming,as of the end of 2024.Total existing stock and new supply figures have been rounded to the nearest thousand,so there may be some margin for error in the totals.NewSupply:2,980,000 sqmChina Retail Property Market Research Report 1H 20256,901.65,628.24,476.63,902.502,0004,0006,0008,00010,00012,00014,00016,00018,00020,000East&Central China(10)North China(11)West China(11)South China(8)Thousand sqm2025 H1 total prime retail estate stockRegional AverageCities with inventory over 10Mm2Top 40 Chinese cities prime retail stock,2025H1Sources:JLL Research,August 2025Top 40 Cities:Shanghai,Beijing&Chengdu exceed 10m sqm24|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 20250.00.20.40.60.81.01.21.41.6Sqm per capitaEast&CentralChina0.61WestChina0.57North China0.52SouthChina0.48Top 40 Chinese cities per capita prime retail space GFA,1H250.55m2percapitaNote:Population figures are based on the 7th National Census permanent resident population.Chongqings population data has been adjusted to reflect the permanent resident population of Chongqings main urban area.Source:Various City Statistical Bureaus,JLL Research,August 2025Type A CitiesType B CitiesType C CitiesType D CitiesRetail Supply:Over-capacity materialized as a potential risk in lower tier cities25|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 202505001,0001,5002,0002,5003,0003,5004,0004,5005,0001234123412341234H120212022202320242025Thousand sqm02,0004,0006,0008,00010,00012,00020212022202320242025ForecastThousand sqm21 cities retail property supply(annual)21 cities retail property supply(quarterly)Note:Subsequent analysis is limited to key cities data.Sources:JLL Research,August 2025Supply Analysis:Full-year achievable rates of pipeline remained volatile and uncertain26|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 2025Type A Cities61.0%Type B Cities17.2%Type C Cities21.800200300400500600WuhanTianjinChengduXiamenSuzhouGuangzhouShenyangNanjingShanghaiZhengzhouShenzhenBeijingThousand sqmx 0.1Supply Analysis:Recalibrate with tier 1 cities dominating the developments40 cities retail property supply,1H25(semi-annual)City-level retail property new supply,1H25(semi-annual)Totalsupply,2025H12.1 Million sqmYoY Growth Rate-27.5%Sources:JLL Research,August 2025Type A CitiesType B CitiesType C Cities27|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 2025China Resources9.1%Wangfujing8.3%New World8.3%Longfor7.6%China Merchants Shekou5.6%COFCO4.5%Hongkong Land3.8%China Overseas3.0%Others49.6%Top operatorsmarket share:50.4%New opening,1H25Basket Shopping MallBeijingNanjingHops*on BeijingXuanwu Garden CityLongfor Hefei HuansiHefeiShenzhenShanghaiWangfujing Shopping CenterLhasaXinyao HuanART PARKGrand MallLongfor Qingxiu Paradise PalkNanningWuhanOcean Mile Citylane Phase 1Non-standard Developments*K11 ECOASTGrandjoy CityNanchangZijin ZhongailiNanjingChangchunVitality Mall Phase 2Luohu YitianHoliday PlazaChengduGreenMileShenzhenGarden City Prince Bay VillaGuangzhouZhengzhouMixC ZhengdongYida FYH MallSources:JLL Research,August 2025Operator share of new supply,1H25Note:*Top operators are defined by JLL Research Department,including leading domestic,Hong Kong,Macau,Taiwan,and foreign operators.*Non-standard Property examples on the right are for illustration only and are not fully included in the high-quality retail property data sample.NanjingIMIX PARKSupply Analysis:Top operators captured over 50%of new openings in 1H2528|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 202502505007501,0001,2501,500ChengduQingdaoWuxiNingboChangshaKunmingXiamenShenyangWuhanSuzhouGuangzhouZhengzhouXianChongqingTianjinHangzhouNanjingShenzhenShanghaiBeijingthousand sqmHangzhou Kerry CentreMajorcities prime retail property new supply forecast,2025Representative prime retail projects,2H25GuangzhouK11 SelectShenzhen Bay MIXC Phase IIShanghai CPIC XintiandiType A CitiesType B CitiesType C CitiesSources:JLL Research,August 2025Note:No new supply is expected in Dalian in 2025,so it has been excluded from the above chart.Supply Analysis:Tier 1 cities continued the dominance in delivering on time29|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 2025Type A CitiesType B CitiesType C Cities05001,0001,5002,0002,500Thousand sqm202520262027Supply Analysis:Pipelines set to shift toward high-tier cities and YTD regionRetail pipeline forecastSources:JLL Research,August 202530|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 20250%2%4%6%8%1Q102Q103Q104Q101Q112Q113Q114Q111Q122Q123Q124Q121Q132Q133Q134Q131Q142Q143Q144Q141Q152Q153Q154Q151Q162Q163Q164Q161Q172Q173Q174Q171Q182Q183Q184Q181Q192Q193Q194Q191Q202Q203Q204Q201Q212Q213Q214Q211Q222Q223Q224Q221Q232Q233Q234Q231Q242Q243Q244Q241Q252Q252025*2026*2027*Type A CitiesType B CitiesType C Cities21 Cities AverageVacancy Analysis:Edging up to peak with a following correction since 2026Vacancy rateSources:JLL Research,August 2025Note:*is forecast.31|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 20256.3%7.9%9.3.6.3.5.2.0.3.8.1%4.8%8.8.5.5.0.2%4.0%4.8%8.2.9%0%5 %XiamenQingdaoDalianXianChangshaZhengzhouTianjinNingboWuxiKunmingShenyangNanjingHangzhouSuzhouChengduChongqingWuhanShenzhenGuangzhouBeijingShanghaiVacancy Analysis:Over half of monitored cities registered vacancy rate increasesVacancy rate,1H25Type A CitiesType B CitiesType C CitiesXiamen4.8%Nanjing7.9%Qingdao11.3%Changsha13.2%Wuhan4.0%Shenzhen4.8%Guangzhou13.0%Chongqing16.8%Kunming18.1%Shenyang11.5%Chengdu11.5%Zhengzhou12.2%Tianjin8.2ijing10.6%Xian9.3lian6.3%Suzhou11.5%Wuxi13.3%Shanghai11.9%Hangzhou8.8%Ningbo4.8%Sources:JLL Research,August 202532|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 20250%2%4%6%8,0004,0006,0008,00010,00012,00014,00016,000200520062007200820092010201120122013201420152016201720182019202020212022202320242025*2026*2027*Thousand sqmNew supply(LHS)Net absorption(LHS)Vacancy rate(RHS)Chinese major cities prime retail market supply&vacancy rateNote:*is forecast.Supply-Demand:Supply holds steady with vacancy to peak in 2025Sources:JLL Research,August 202533|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 2025-8%-6%-4%-2%0%2%4%6%8%1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 1Q25 2Q25Type A CitiesType B CitiesType C Cities21 Cities AverageRetail Rental:Accelerated rental contraction amid heightened market pressure in 1H25Chinese major cities prime retail GFR average YoY changeNote:The rental change is based on the same sample comparison.Sources:JLL Research,August 202534|2025Jones Lang LaSalle IP,Inc.All rights reserved.2025China Retail Property Market Research Report 1H 202539.2!.34.6.3%8.7.7%8.9.61.5).2.3$.8%6.8.7.0.0%9.3.9%9.0.5%4.5.7%7.9.5%0.0%1.5%0.0%3.3%Leasing Overview:Fashion sectors contracted during retail demand rebalancingF&BChildrenFashionServiceLifestyleEntertainmentIntegrated Operator*ShanghaiChengdu2024H1 New Leases2025H1 New LeasesNew leases by sector:Shanghai vs.Chengdu shopping malls(by NLA)Note:A department store or large format specialty retailer that serves as an anchor within a shopping center.Data for Shanghai and Chengdu is sourced from prime retail projects,and this sample will be consistently applied to all subsequent tenant analyses.Sources:JLL Research,August 202536|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 2025-1.5-1.0-0.50.00.51.0FashionF&BLifestyleChildrenServicesEntertainmentDepartmentStores/SpecialtyStores-1.5-1.0-0.50.00.51.0FashionF&BLifestyleChildrenServicesEntertainmentDepartmentStores/SpecialtyStoresStandard Deviation%of shopping malls held by top operators36.4(.9.3%9.5%8.3%3.4%0.24.7A.6%National average25.91.1.8.1%8.4%9.9%6.8%9.3%3.1%3.8%LHS:standard deviation enhancing the comparability across sectors%:original data as the market share WRT the number of tenants25.5&.6.4%7.6%9.6.8%3.5$.4).8$.1(.6.1.9%6.8%7.8%7.9.8.2.1%by number of tenantsby leased spaceDescending sectorsAscending sectorsIrregular sectorsConstant sectorsF&B and ServicesFashionLifestyle,Kids,and EntertainmentDepartment Stores/Specialty StoresTenants Overview:Top operators showed strength in leasing across lower tier citiesSources:JLL Research,August 2025Type A CitiesType B CitiesType C CitiesType D CitiesNote:The variance in the proportion of department stores/specialty stores remains small,with the share WRT the number of tenants accounting for 0.2%and the leased space for 3.5%.Due to the insignificance in difference,the result has been removed from the chart.37|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 2025Trends:The changes in demographics,product value,retail space and retailersGrowing population of Gen-Z and the Unmarried 1The recognition to functions and emotion links2The value change from shopping space to social space3The rise of Chinas home-grown brands4The synergy of consumption trends and retail trendsDemand TrendConsumption TrendSources:JLL Research,August 202538|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 20253.1 Demographic Adaptiveness:Growing population of Gen-Z and the Unmarried Trend and Forecast of the Number of Pet Economy-Related Enterprises in China(2019-2025)50.677.0142.5209.1340.9419.2503.00200400600201920202021202220232024 2025EPet-friendly F&BPet RetailPet ExperiencePet Care ServicesHuman-Pet Co-living SpacePet-FriendlyServicePet Community EventsRetailerRetail Properties0%2%4%6%ChengduShanghai25H124H1Proportion of New Leases for 3C Electronics in Shanghai&ChengduSmart Home Market Size in China (2014-2019)02,0004,0006,0008,00010,000201920202021202220232024The emotional substitution effect under the“singles economy”has driven the rise of the pet economy.Domestic Tourism Expenditure Per Trip(2011-2024)7317688068398578889119269537748998061,0041,0246007008009001,0001,100201120122013201420152016201720182019202020212022202320242024 Tiktok Camera Category Sales YoY Growth During“Double 11”277.6C7.42.3%00 0000P0%Mirrorless CameraDigital CameraAction CameraGenerational consumer shifts with consumption quality,tourism spending is rebounding.Gen Zs pursuit of technological innovation is accelerating the development of smart home solutions.RMBSources:National Tourism Administration,JLL Research,August 202539|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 202519.0&.80.5.0.5.4%9.9%9.7shionF&BLifestyleChildrenServiceEntertainmentApparelWithdrawnAll Sectors Withdrawn by NLAFashion BreakdownApparel Breakdown3.2 Value Recognition:The stronger focus on utilities and emotion fulfillment Functional Value PremiumBrand Value Premium-30%-20%-10%0 10152025LOUIS VUITTONCHANELHERMESDiorGUCCIPRADABillion Euro2024Revenue(LHS)YoY Growth Rate(RHS)SalomonYoY Growth 400%KEENKailasonHOKAYoY Growth 100% 16.624.443.141.652.479.7100.00.30.71.84.510.750.7100.011418728832936340101252503755000501001502002019202020212022202320242025*Overseas(LHS)Mainland China(LHS)Number of Stores(RHS)0%1%2%3%4%1H251H24Emotional Value PremiumPerformance of top luxury brands in 20240.0%0.5%1.0%1.5%2.0%2.5 1920202021202220232024Mass Market ApparelWithdrawnApparel withdrawn in 2025H1Pop Mart revenue and number of storesShanghai&Chengdu new leases of designer toysOutdoor brands market share in ChinaOutdoor goods sales performance in 618 promotionLululemeonDescenteHelly HansenYoY Growth 50% KolonPELLIOTLafumaConsumers exhibit strong wiliness to pay for brand premium amid stabilized income outlook,while the willingness moderates nowadays.Cost-Effectiveness Dominates Amid Income Uncertainty.Functional sportswear are popular among outdoor enthusiasts.Amid macro volatility,consumers pursue immediate emotional compensation via purchases.Sources:Financial Report,JingDong,CBMC Securities,JLL Research,August 202540|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 20253.3 Retail Place Making:An upgrade from“Shopping Space”to“Social Space”Tenant mix:Tenant mix evolves amid consumer trend changes.275%4%6%3$0%9%6%4shionLifestyleF&BEntertainmentServiceChildren1H252023YETenant mix in Shanghai shopping malls*Proportion of new opened entertainment space in Shanghai*0%1%1%2%2%2%4%1H241H25GamingTheater/GalleryKTVOtherentertainmentProportion of new opened service space in Shanghai*1%1%2%2%8%1%1%2%4%1H241H25Beauty serviceHealth serviceSports/FitnessPet serviceOther serviceStore space:Diversified store contents rise the demand of new space.Common area:Common area repositioning brings revenue opportunities and upgraded consumer service140215228236351799FashionF&BChidrenLifestyleServiceEntertainmentsqm2023YE1H25Average store size in Shanghai*(by category)Flagship StoresPop-up StoresStore ClusterNew forms of storeLeasing opportunities Outdoor areas and pop-up venues drive emerging leasing demand.Mall communityThemed contents and community events tailored to niche interests(e.g.,sports,anime,toys).Consumer serviceVIP Lounge,Tax refund counter,Care zone,Multi-functional social and meeting space,etc.Sectors with active leasing momentum Sports venuesHealth serviceInteractive diningEntertainment41|2025Jones Lang LaSalle IP,Inc.All rights reserved.Note:*Proportion by retail NLA;Based on 36 Shanghai prime shopping mallsSources:JLL Research,August 2025China Retail Property Market Research Report 1H 202510.86.85.74.33.93.021b%4c53%0%Pu812PROYAShangmeiBotaneeJuziMAOGEPINGMARUBIRMBbillionFull-year revenue(LHS)Y-o-Y Growth(RHS)2024 revenue of Chinas cosmetics groupDomestic brands show strong growth momentum22.83.6Q.9T.0%.3.4 241H25Local brandsDomestic brandsInternational brandsShare of store NLA by brand origins:2024 stock vs.new leases(2025H1)in a leading cityBy elevating product quality and developing cultural IP assets,domestic brands cater to consumers growing demand for both functional utility and emotional value,thus gaining increased market competitiveness Product QualityManufacturingConsumer electronicsCosmeticsDesigner brandsCulture and IP0306090120RMB trillionRevenue of manufacturing enterprises in China,2020-1H25122025Q1 Tmall Bag&Luggage Sales RankingXiaomis 2025Q1 Smart Home Appliance Revenue Increased 113.8%y-o-yShipments 65%y-o-yAir conditionerShipments increased 65%y-o-yRefrigeratorShipments 100% y-o-yWashing Machine 6% 16% 20% 22% 30% 41auty&Personal CareFurniture&Home FurnishingsElectronics&AppliancesDaily NecessitiesApparel&AccessoriesFood&BeverageNet sales flow=(Percentage of increase in domestic brand sales)-(Percentage of increase in foreign brand sales)Net sales flow into domestic brands11122182126283420202021202220232024Mainland ChinaHong Kong&MacauNumber of stores of Laopu Gold 05101520SongmountCharles KeithYSLGUCCIQIUZHENGROTTOCOACHceceLONGCHAMPRMB thousandSongmountCharles KeithDomestic BrandsForeign BrandsSource:Source:National Statistics Bureau,Brands financial reports,Tmall,JLL Research,August 2025Culture heritageOriginal IP DevelopmentDomestic brands create commercial value through deep integration of Chinese heritage.Intangible cultural assets including film and television,gaming,characters and brands have been converted into a variety of products and services,bringing business opportunities across a diverse range of retail sectors.3.4 Home-grown Retailer Power:Phenomenal rise of Chinese brands and industries42|2025Jones Lang LaSalle IP,Inc.All rights reserved.2025China Retail Property Market Research Report 1H 2025PolicyThe Ministry of Finance continued to directly allocate ultra-long-term special government bond funds to local governments,with a total of 300 billion yuan expected to be allocated throughout the year to support the replacement of old consumer goods with new ones.Enhancement of the“Trade-in”programme2025H1 trade-in program for consumer goods drove retail sales growth across multiple categoriesRising of service consumptionFostering new consumption modelsand formsPolicy-driven of departure tax refund schemePolicyThe State Council issued the Special Action Plan for Boosting Consumption,which aims to deepen the integration of business,tourism,culture,sports,and health-related consumption.The plan supports tourist attractions and cultural and museum institutions in expanding their service offerings,reasonably extending operating hours,and increasing their capacity to accommodate more visitors.2025H1 Foreigner visits:38.1 million30.2 25H1 foreign nationals entered China visa-free:13.6 million53.9%Tax refund sales amount for departing travelers in H194.6%PolicyChina continue to expand the list of countries eligible for visa exemption and further optimize regional visa-free entry policies.More high-quality merchants will be supported in becoming tax-refund shops for departing travelers,and the immediate tax refund upon purchase policy for shopping will be promotedPolicyEligible National IV emission standard gasoline passenger vehicles will be included in the list of old vehicles eligible for scrappage and renewal subsidies.A subsidy of RMB 20,000 will be provided for each new energy passenger vehicle purchased,and RMB 15,000 for each gasoline passenger vehicle with an engine displacement of 2.0 liters or below.30.7%Household Appliances and Video Equipment25.4%Cultural and Office Appliances24.1%Communication Appliances22.9%FurnitureLabor Day holidaydomestic tourists:314 million6.4%H1 national box office:29.2 billion CNY20.0%Online Retail Sales of Physical Goods in the H16.0%Retail Sales of New Energy Vehicle in H133.3%y-o-yy-o-yy-o-ySources:Ministry of Commerce of China,National Immigration Administration,publicly available information,JLL Research,August 2025Policy:Trade-in policy fostered domestic consumption,but tightened in Q2y-o-y44|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 20251234Leasing StructureBrand ContentRental CostMarketing Promotion Adjusting the mix of business formats and reducing individual store sizes Precisely position content to enhance project uniqueness Moderately reduce rent and cut unnecessary expenses Diversified Online and Offline Channel MarketingOperatorCater to consumer demand and lower the consumption thresholdMaintain merchant quality and increase project visibilityValue cost-effectiveness;average spending is decreasingFocus on emotional value and pay more attention to their own needs45|2025Jones Lang LaSalle IP,Inc.All rights reserved.Operator:Recalibrating tenant selection benchmarks in response to sentiment change1.Adjust the business mix by appropriately increasing the proportion of F&B tenants and reducing the proportion of retail tenants,to maintain occupancy rates.2.Reduce individual store sizes to ease leasing pressure.3.Increase the presence of experiential and pet-related businesses to attract younger consumers,maintain project popularity,and boost visitor traffic.1.Lower rents for new leases to encourage long-term,while utilizing multiple leasing strategies to retain existing tenants.2.Increase the proportion of pure percentage-rent tenants to attract new brands or retain existing ones.3.Appropriately reduce non-essential expenditures and instead increase spending on soft services and events to boost foot traffic and project popularity.1.Differentiate from others by adjusting brand positioning,replacing brands that do not fit the target customer group,and enhancing projects unique characteristics.2.For traditional business formats,lower brand entry requirements and introduce non-chain brands.3.Increase the proportion of mass-market and high cost-performance brands to improve sales per square meter.1.Effectively leverage media platforms to conduct integrated online and offline marketing,thereby increasing the overall traffic of the project.2.Boost the projects revenue by enhancing holiday decorations,organizing markets,and adding pop-up and touring events to increase both foot traffic and diversified income.Sources:JLL Research,August 2025China Retail Property Market Research Report 1H 20250.0050,000.00100,000.00150,000.001 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6202320242025Million yuan010203040506070123456789 10 11 12 123456789 10 11 12 123456202320242025CasesNumber of financing deals in H1 2025(YoY)69.4%The total financing amount in H1 2025(YoY)94.6%Investment:Sentiments staged a robust rebound,propelling transaction growthFinancing amount and volume in the consumer sector(Incomplete statistics)46|2025Jones Lang LaSalle IP,Inc.All rights reserved.Sources:Based on public information,JLL Research,August 2025China Retail Property Market Research Report 1H 20254560149177494042025H12024H1Others22.8 25H1LifestyleDining51.0%Tea&Beverage24.5%Liquor8.2sserts&Bakery6.1%Others10.2 25H1Food&Beverage147Household Appliances&Smart Home15.4%Automobiles&Related Services18.7%Consumer Electronics43.1G|2025Jones Lang LaSalle IP,Inc.All rights reserved.Consumer sector financing volume*(Incomplete statistics)Investment:Robotics surged,contrasting with declining capital allocations to F&B492017111198777LifestyleFood&BeverageServiceChildrenCosmetics&Personal CarePetFashionOthersSilver EconomyTourismEntertainmentSources:Public information,JLL Research,August 2025Note:*Financing data does not include IPO round financing events.China Retail Property Market Research Report 1H 2025Catalyzing ConsumptionResponsive Repositioning:In H1,retail property operators proactively adapted mall and tenant to macro uncertainty and traditional segment contraction,balancing evolving consumption patterns with stabilized foot traffic and operational KPIs.Tenant Retention:Sector-wide efforts prioritized reducing temporary vacancy through rental flexibility,space reconfiguration,and format optimizationdeploying proven tactics to secure occupancy.Cost Saving and Efficiency:Prudent operational expenditure remains essential during market transitions.Targeted marketing and funneled traffic generation,aligned with core customer profiles,replaced inefficient blanket campaigns to maximize ROI.Sharpening OperationPolicy Signals:Investment flows reveal prescient bets on emerging consumption trends,highlighted by robotics-focused deals post-2025 CCTV showcase,illustrating capitals market-shaping foresight.Capital Preference:Near-term consolidation favors tech-compliant firms,accelerating subpar capacity exit.Long-term capital targets sustainability,digitalization,and globalization,transitioning consumption growth from scale to value.Property Investment:Phased market recalibration spotlights the priority for premium retail hubs.The capital concentration back to tier I cities,reflects intensified cyclical prudence and geographic preference amid economic uncertainty.Capturing OpportunitiesPolicy AngleOperation AngleInvestment AngleTri-angle SummaryPolicy Effect:Since 2025,Chinas old-to-new trade-in program expanded funding and boosted retail sales in benefited sectors.Capital markets reacted positively to China manufacturing and consumption industries in May-June.Policy Direction:Government subsidy prioritizes automobiles,home appliances,electronics and spurs green upgrades,with aims at driving the consumption industries toward sustained developments.Implementation Softening:Recent tightening policies cooled related July consumption.Future effects hinge on local implementations sustainability.48|2025Jones Lang LaSalle IP,Inc.All rights reserved.Sources:JLL Research,August 20252025China Retail Property Market Research Report 1H 202503,0006,0009,00012,00015,0002005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025*2026*2027*2028*Thousand sqmType A CitiesType B CitiesType C CitiesStart-up Phase:From 2005 to 2012,supply grew from 1.6 million sqm to nearly 8 million sqm,representing a CAGR of 25.6%.1Peak Stage:In 2017,supply reached its peak,with the average annual new supply surpassing 10 million sqm2Recovery Phase:In 2021,new supply expanded to more than 11 million sqm.Tier I cities showed resilience,and their market share is projected to reach 36.5%by 2025.3Rebalancing Phase:In 2026,new supply will decline to 6 million square meters,with a continued downward trend in future.The decline will be more significant in non-first-tier cities.41234Supply Outlook:Orderly pipeline moderation sets stage for rebalancing since 20262005-2028 New supply in four phasesStart-up PhaseSources:JLL Research,August 2025Peak PhaseRecovery PhaseRebalancing Phase50|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 202520252028 Composition of new high-quality retail property supply0 0Pp0 28202720262025Domestic Leading OperatorsForeign Leading OperatorsOthersStrategic Foresight and Pace Control of Leading EnterprisesLeveraging strong data mining and market insight capabilities,leading enterprises can accurately anticipate supply-demand cycles and consumer trends.This enables them to make more scientific decisions regarding project development,market entry timing,and tenant mix,avoiding blind following.By proactively adjusting the pace of supply,they can effectively match the dynamic changes in market demand,significantly reducing the risk of large-scale vacancies caused by poor timing or mispositioning and ensuring the stability of asset fundamentals.1Revitalizing Assets and Stabilizing the Market through Light-Asset ModelsThe mature“light-asset”model of leading operators is a core advantage.This capability empowers asset owners who lack operational expertisesuch as local state-owned enterprises and small to medium-sized developers.By introducing professional teams,standardized processes,and digital asset management platforms,help to improve efficiency and rejuvenate existing projects.This can reduce the incidence of unfinished or long-term idle projects caused by operational failures,thereby maintaining overall market health and investor confidence.2Strategic Brand Partnerships to Address Project ChallengesLeading operators leverage strong brand partnerships to mobilize high-quality commercial resources.When projects face difficulties such as poor locations or low foot traffic,they can bring in anchor tenants or popular brands to attract customers and stabilize operations.This resource integration capability helps projects overcome inherent disadvantages or temporary crises.This is something smaller players often cannot achieve,thus avoiding negative cycles and ensuring steady recovery.3Supply Outlook:Top operators dominate pipelines,mitigating operational risksSources:JLL Research,August 202551|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 20250%2%4%6%8 05 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025*2026*2027*2028*Type A CitiesType B CitiesType C CitiesNationwideVacancy rates in four phases1243Start-up Phase:Tier B cities had high vacancy rates in the early stages,but by 2010,these rates dropped to a healthy level of around 6%.1Peak Phase:In 2015,new supply in Type A cities slowed,lowering vacancy rates to 5.6%.In Type C cities,increased supply pushed vacancy rates up to 11.7%.2Recovery Phase:Around 2022 Vacancy rates across all city types peaked,subsequently entering a phase of fluctuation and gradual recovery.3Rebalancing Phase:The pace of new supply nationwide has slowed,and vacancy rates across all city types have entered a gradual decline.4Vacancy Outlook:Vacancy correction expectation buoying market sentiment Start-up PhasePeak PhaseRecovery PhaseRebalancing PhaseSources:JLL Research,August 202552|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 2025Rental y-o-y growth in four phases-10%-5%0%5 06 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025*2026*2027*2028*Type A CitiesType B CitiesType C CitiesNationwide1243Start-up Phase:The 2009 financial crisis quickly impacted Type A cities,leading to the first-ever decline in rents for Class A cities.1Peak Phase:The average rent growth in Type A cities outpaced the national average,while rent growth in Type B cities was lower than that of Type C cities2Recovery Phase:Nationwide rents declined with fluctuations.In 2021,rent growth in Type A and B cities briefly turned positive before returning to a period of supply-demand adjustment.3Rebalancing Phase:Nationwide rent declines narrowed.Asset values in first-tier cities stood out,with rents leading the return to an upward trend.4Start-up PhasePeak PhaseRecovery PhaseRebalancing PhaseSources:JLL Research,August 2025Note:Rent changes are based on the same sample.Rental Outlook:Tier-1 cities spearhead rental recovery,anchored by balancing indices53|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 202576$%Overall OptimisticSomewhat Pessimistic2025202496vR%4h(%8%Tier-1 CitiesTier 1.5 Cities,GDP Top 10Tier-2 CitiesOther Cities(please specify)202520242025 Investor preferences for city entry2025 Retail investment sentiment96hD(%4mily-orientedShopping MallFashion-forwardShopping MallOutlet MallTransportation HubShopping MallHigh-endLuxuryShopping MallCommunity/NeighborhoodRetail ProjectCultural&Tourism-themed RetailProject2025 Investor preferences for asset typesChina retail development maintained a expanding momentum over the past decade-plus,progressively extending from Tier 1 cities into lower-tier markets.However,slowing population inflows in non-core cities and the closing development window have pushed existing stock to scale plateau,exhausting supply-demand gap opportunities.Consequently,future development will refocus on high-tier cities,while investor preferences for retail asset investments recalibrate toward these premium markets to mitigate risk exposure.China retail development has entered a repositioning innovation cycle,catalyzing diverse new consumptions.Prime retail assets are concentrated in primary/secondary urban cores,while neighborhood retail developments lag with limited quality tenant mix.Community retail assets remain scarce for flight-to-quality developments,but demonstrates outperforming asset-level metrics,attracting yield-focused investors.Conversely,luxury retail faces headwinds from moderating high-end spending and elevated capital requirements,resulting in subdued near-term investment appeal.Capital Market:Retail investment sentiment strengthens,focus back to high-tier citiesSources:2025 JLL retail property Investment Survey,JLL Capital Markets,August 2025Chinas prime retail pipeline will undergo progressive rationalization,driving a gradual restoration from over-supply.This fundamental recalibration is propelling capital market reappraisals,with investor sentiment toward retail real estate bulk investments projected to shift positivelyreflecting a 16 ppts surge in optimistic outlooks by 2025.54|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 2025Supply-demand rebalancingNew Supply Undergoes Four Cyclical Evolutions:Chinas prime retail property supply has experienced a start-up phase(2005-2012),a peak phase(2013-2019,with annual new supply of around 10 million sqm),and a recovery phase(2020-2025).It is now set to enter a rebalancing phase,with annual new supply shrinking to approximately 5 million sqm,halved the scale of the peak period.Market Supply Dominated by Leading Players:During 2025-2027,leading operators account for over 50%of pipelines,significantly reducing leasing and operational risks.On one hand,their mature asset-light models can efficiently revitalize existing stock and stabilize market supply-demand dynamics;on the other,their strong resource integration capabilities provide effective support for new projects,further strengthening market fundamentals.Vacancy Rate Enters Gradual Decline:During the recovery phase,vacancy rates have faced temporary pressure due to the process of supply-demand rebalancing.As new supply contracts during the contraction phase,the national average vacancy rate is expected to gradually decline,reaching 10.1%by 2028.Investment Opportunities Seeking a New Rental Equilibrium:According to JLL data,after the supply recovery phase,the national average rent entered a downward trajectory for the first time in 2020,with a decline of over 5%.After a brief rebound in 2021,rents resumed a volatile downward trend.It is expected that the full-year decline in 2025 will be the same with that in 2022.As the market enters the contraction phase,the decline in rents across Chinese cities will narrow.Rents in first-tier cities are expected to be the first to return to an upward trend,highlighting the value of these assets.Capital Market Sentiment Improves:In 2025,optimism in Chinas retail property investment market jumped by 16 percentage points to 76%,driven by supply-demand rebalancing and the resulting recovery of market fundamentals.Investor preferences have become more polarized:attention to first-tier cities reached 92%,and preference for the top 10 GDP cities was as high as 76%,underscoring the return of core city value.In terms of asset types,community shopping centers topped the list with a 96%preference rate,while high-end luxury projects attracted only 28%of attention,reflecting investors pursuit of high-cost-performance assets amid consumption downgrading trends.Outlook:Supply-demand rebalancing expected to propel asset value appreciationSources:JLL Research,August 202555|2025Jones Lang LaSalle IP,Inc.All rights reserved.China Retail Property Market Research Report 1H 202503 3637Over the past three years,persistently bearish sentiment has clouded Chinas retail property market as plummeting metrics fueled deepening pessimism.While dispassionately depicting this reality,our research simultaneously sought early signals of an inflection point scrutinizing forward-looking indicators like consumer confidence indices,foot-traffic,and supply-demand dynamic statistics.Yet even as our annual report published in early 2025,no empirical evidence conclusively heralded the markets cyclical turn;the anticipated resurgence remained a conviction anchored not in data,but in the tectonic recalibration already stirring beneath the statistical silence.H1 2025 data confirms persistent headwinds across Chinas retail property sector:rising vacancy rates,strained foot traffic,underperforming apparel brands,and rental declines.Yet retails fundamental axiom remains immutable location sensitivity dominates all.As commercial lands in central location grows increasingly scarce,future supply of truly exceptional projects will inevitably dwindle.For over a decade,developers leveraged retail developments as land acquisition vehicles for residential monetization,breeding a proliferation of poorly conceived properties.While the 40 major cities now hold over 200 million sqm of retail stock,a material portion afflicted by inferior quality,decentralized locations,deficient accessibility,or mismanaged operations,faces obsolescence.Dubbed“ST-grade assets”(a nod to capital markets special treatment designation for distressed equities),such risks were masked during boom cycles.However,the three-year market correction has exposed their vulnerabilities.Now,these underperforming assets have solidified as the principal drag on nationwide vacancy stabilization and rental recovery,skewing aggregate performance metrics downward.H1s sharp deceleration in new retail development marks a structural transition,with this moderation projected to extend through 2027.We anticipate a market fundamentally reshaped by top operators,reinforcing confidence in an imminent inflection point.Critically,flight-to-quality development pipelines now prioritize location-centric logic and developer credibility,enhancing project viability.Higher tier cities will anchor the recalibration,benefiting from consolidated prime holdings and demographic resilience.Thus,2025 initiates a dual-phase transformation:silent consolidation during supply ebb and organic momentum reconstruction during operational refinement.As industry and regulators amplify counter-disorder measures,the clearance of excess low-quality supply will inevitably coincide with the revaluation of premium assets,when genuine quality claims sovereignty.Stripped of speculative excess,Chinas retail property sector transcends its concrete shells to forge a sustainable paradigm anchored in experiential ingenuity,capital fluidity and consumer-centric agility,marking a recalibration where enduring profitability converges with qualitative evolution.In the mid-2025,we discern the glimmer of a possible turn-around;embracing this departure,the industry sails toward a voyage of reinvention where lights lead ahead.China Retail Property Market Research Report 1H 2025Daniel YaoHead of Research,JLL ChinaDaniel.YJacky ZhuHead of Retail Research,JLL ChinaJackyjh.ZRebecca LongManager,Research JLL ChinaRebecca.LJiemin WuHead of REIS ChinaJLL ChinaJiemin.WXiaohui ZhangSenior Analyst,ResearchJLL ChinaXiaohui.ZAnita SunManager,Research JLL ChinaAnita.SJLL Research TeamJLLs research team delivers intelligence,analysis and insight through marketleading reports and services that illuminate todays commercial real estate dynamics and identify tomorrows challenges and opportunities.Our more than 550 global research professionals track and analyze economic and property trends and forecast future conditions in over 60 countries,producing unrivalled local and global perspectives.Our research and expertise,fueled by real-time information and innovative thinking around the world,creates a competitive advantage for our clients and drives successful strategies and optimal real estate decisions.COPYRIGHT JONES LANG LASALLEIP.INC.2025This report has been prepared solely for information purposes and does not necessarily purport to be a complete analysis of the topics discussed,which are inherently unpredictable.It has been based on sources we believe to be reliable,but we have not independently verified those sources and we do not guarantee that the information in the report is accurate or complete.Any views expressed in the report reflect our judgment at this date and are subject to change without notice.Statements that are forward-looking involve known and unknown risks and uncertainties that may cause future realities to be materially different from those implied by such forward-looking statements.Advice we give to clients in particular situations may differ from the views expressed in this report.No investment or other business decisions should be made based solely on the views expressed in this report.Authors57|2025Jones Lang LaSalle IP,Inc.All rights reserved.
2025-08-22
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MARKET FIGURESUK Office MarketQ2 2025CBRE RESEARCHAUGUST 20252CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market FiguresKey StatsTake-up Q2 2025Take-up(YoY change)AvailabilityQ2 2025Availability(YoY change)Prime rentQ2 2025Availability rateQ2 2025City1,294,883-26%9,688,601-1.0012.3%West End778,099 32%6,447,905 50.007.1%Midtown294,049 106%2,196,320-13.508.4%Southbank146,316 70%2,732,606-5.0013.5%Docklands352,758 47%2,174,535-15Q.5011.1%South East598,814-3.0,050,373-8.6W.008.6erdeen101,246 70%1,606,157-132.5016.8lfast81,768 18%1,171,8538%.5013.0%Birmingham110,282-34%2,422,083-12E.5014.0%Bristol115,862-3%1,197,984-15I.0013.6mbridge133,267 364%1,283,125 17b.0011.6inburgh125,802 12%1,972,582-7F.5010.9%Glasgow106,680-33%2,258,622-7A.509.8%Leeds84,329-15%1,547,262-15B.5011.9%Liverpool51,590 1164,598-45.0016.0%Manchester261,547-21%4,455,572-1E.0017.7%Oxford54,446 60%1,469,403 41c.5034.7%Southampton65,171 102418,822-80.006.4BRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market FiguresUK Office Market OverviewBelfastLeedsSouth EastCentral LondonBirminghamGlasgowAberdeenLiverpoolBristolEdinburghSouthamptonManchesterClick on the locations on themaptoview market dataUse the navigation bar top right to move between sections and the mapCambridgeOxford4CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market Figures Take-up for offices in the UK Markets totalled 2.6m sq ft in the first half of 2025,a slight fall from the same period in 2024(-2%).Q2 take-up totalled 1.3m sq ft,remaining broadly unchanged quarter-on-quarter,but fell 11%from the five-year quarterly average of 1.5m sq ft The largest deal of the quarter saw Altrad take-up 70,400 sq ft at The Apex,Howe Moss Crescent,Aberdeen The TMT sector has been responsible for the largest share of take-up in the last 12 months,accounting for 19%of total take-up,followed by the business services sector,accounting for 17%.The TMT sector accounted for more than a quarter(27%)of take-up during H1 2025,a larger proportion of take-up than any H1 in the last 10 yearsUK Markets*Q2 2025024681020002001200220032004200520062007200820092010201120122013201420152016201720182019202020212022202320242025 YTDAberdeenBelfastBirminghamBristolEdinburghGlasgowLeedsLiverpoolManchesterSouthamptonOxfordCambridgeAddressCitySize(sq ft)OccupierThe Apex,Howe Moss CrescentAberdeen70,400AltradAgeas House,Hampshire Corporate ParkSouthampton38,200Aviva Central ServicesManchester Goods Yard,Studio WayManchester35,400SoftcatCity Quays 2,Corporate SquareBelfast34,700Thales GroupNo.3 Circle Square,Oxford RoadManchester31,000Havas14%4%9%UK Markets take-up by sector,12 months to end Q2 2025UK Markets annual take-upUK Markets key deals,Q2 2025*The UK Markets are comprised of the 12 city office markets outside of Central London tracked by CBRE:Aberdeen,Belfast,Birmingham,Bristol,Cambridge,Edinburgh,Glasgow,Leeds,Liverpool,Manchester,Oxford and Southampton.Belfast figures commence 2011/Oxford and Cambridge commence 2014Banking&FinanceBusiness ServicesTMTConsumer Services&LeisureInsuranceManufacturing,Industrial&EnergyProfessionalPublic SectorMillions sq ftSource:CBRE ResearchSource:CBRE ResearchSource:CBRE Research5CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market FiguresUK Markets Q2 2025 Availability across the UK Markets decreased by 3%to stand at 20.7m sq ft at the end of Q2.Availability remained broadly in-line with the five-year average.The supply for new space remained constrained,representing less than a quarter of the total(23%).Availability rates across the UK markets fell by 36 bps during the quarter to 13.9%A total of 1.6m sq ft of development space completed across the UK markets in H1 2025,41%of which was let at the end of the quarter There is currently 3.1m sq ft of space under construction across the UK markets with earliest possible completions dates up to 2028,of which 17%was pre-let or under offer.There is currently 0.8m sq ft of space under construction and due to complete during the second half of 2025.UK Markets development pipelineUK Markets availabilityUK Markets availability rates 0.00.51.01.52.02.53.03.54.04.5200820092010201120122013201420152016201720182019202020212022202320242025202620272028CompletedUnder construction(speculative)Under construction(pre-let)10-year average0481216202000200120022003200420052006200720082009201020112012201320142015201620172018201920202021202220232024Q2 2025SecondhandNew/early marketed0%3%6%9 18201920202021202220232024Q2 2025Millions sq ft%Millions sq ftSource:CBRE ResearchSource:CBRE ResearchSource:CBRE Research6CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market FiguresCentral London Q2 2025 Take-up across Central London increased by 28%quarter-on-quarter to end Q2 at 2.9m sq ft.The Q2 figure was also up by 3%from the same period last year,and just above the long-term quarterly average level( 1%).Take-up totalled 5.2m sq ft in H1 2025,up by 3%from the same period last year Throughout the quarter five deals over 100,000 sq ft transacted,which is the highest number seen in a single quarter since Q3 2018.Three of these large deals involved banking and finance occupiers,contributing heavily to the banking and finance sector dominating the market in Q2,accounting for 39%of total take-up The largest deal of the quarter saw Squarepoint Capital pre-let 398,200 sq ft at 65 Gresham Street,EC2.Four of the five largest deals of the quarter were for pre-let space,contributing to the high level of pre-let take-up in Q2Central London annual take-upCentral London key deals,Q2 202530%9%7%6%48121620199819992000200120022003200420052006200720082009201020112012201320142015201620172018201920202021202220232024YTD 2025SecondhandNew completedPre-letAddressSize(sq ft)Occupier65 Gresham Street,EC2398,000Squarepoint Capital76 Southbank,74/78 Upper Ground,SE1191,100Lego100 New Bridge Street,EC4190,900State StreetCentral London take-up by sector,12 months to end Q2 2025Banking&FinanceBusiness ServicesTMTConsumer Services&LeisureInsuranceManufacturing,Industrial&EnergyProfessionalPublic Sector10-year average:11.8m sq ftMillions sq ft170.00Central LondonPrime Rent7.8ntral LondonAvailability RateSource:CBRE ResearchSource:CBRE ResearchSource:CBRE Research7CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market Figures012345Q2 2015Q4 2015Q2 2016Q4 2016Q2 2017Q4 2017Q2 2018Q4 2018Q2 2019Q4 2019Q2 2020Q4 2020Q2 2021Q4 2021Q2 2022Q4 2022Q2 2023Q4 2023Q2 2024Q4 2024Q2 2025Central London Q2 2025 Under offers in Central London decreased by 14%during the quarter,totalling 3m sq ft at the end of Q2.The quarterly decrease left under offers 12low the long-term average level of 3.4m sq ft.A total of 2.2m sq ft was newly placed under offer during the quarter,edging above the average level There were seven units over 50,000 sq ft under offer at the end of Q2,down from 11 at the end of the previous quarter.This is likely due to a number of these transacting throughout the quarter.The largest under offer in Q2 was at 1 Hanover Street,W1,where 124,000 sq ft was under offer Under offers increased in the Docklands and Midtown by 61%and 66%(respectively)but decreased in the other three main Central London submarkets.Southbank saw the largest quarterly fall(-37%),while the West End and the City saw falls of 15%and 9%,respectively Central London under offersAddressSize(sq ft)Occupier1 Hanover Street,W1West End124,000ConfidentialThe St Botolph Building,St Botolph Street,EC3City69,300Multiple Tenants88 Wood Street,EC2City67,700IG IndexMillions sq ftCentral London key under offers,Q2 202510-year average:3.4 m sq ftSource:CBRE ResearchSource:CBRE Research8CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market FiguresCentral London Q2 2025 Supply totalled 23.2m sq ft across Central London at the end of Q2,remaining stable compared to the previous quarter,but well above the ten-year average of 18.6m sq ft.Apart from the City,supply fell in all the main Central London submarkets in Q2.The City saw total availability increase for the second consecutive quarter,by 8%from Q1 There were 22 buildings across Central London with more than 100,000 sq ft of ready-to-occupy space available at the end of the quarter.Of the 22 units,ten were newly completed developments.The largest ready-to-occupy space was at YY London,30 South Colonnade,E14 where 275,000 sq ft was available at the end of the quarter The Central London vacancy rate decreased during Q2,ending the quarter at 7.8%(compared to 8.1%at the end of Q1)Central London development pipelineCentral London availabilityCentral London vacancy rates0481219921993199419951996199719981999200020012002200320042005200620072008200920102011201220132014201520162017201820192020202120222023202420252026202720282029 CompletedU/C let/under offerU/C available051015202530Q2 2015Q4 2015Q2 2016Q4 2016Q2 2017Q4 2017Q2 2018Q4 2018Q2 2019Q4 2019Q2 2020Q4 2020Q2 2021Q4 2021Q2 2022Q4 2022Q2 2023Q4 2023Q2 2024Q4 2024Q2 2025SecondhandNew completedEarly marketed05101520Q2 2015Q4 2015Q2 2016Q4 2016Q2 2017Q4 2017Q2 2018Q4 2018Q2 2019Q4 2019Q2 2020Q4 2020Q2 2021Q4 2021Q2 2022Q4 2022Q2 2023Q4 2023Q2 2024Q4 2024Q2 2025Central LondonCityWest EndMidtownDocklandsMillions sq ft%Millions sq ft10-year average:18.6m sq ftSource:CBRE ResearchSource:CBRE ResearchSource:CBRE Research9CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market Figures01234562004200520062007200820092010201120122013201420152016201720182019202020212022202320242025 YTDThames ValleyM25 NorthM25 South10-year average5-year average1!%24%3%5%South East Markets Q2 2025 In Q2,take-up of units over 10,000 sq ft across South East markets totalled 598,800 sq ft,down 21%from the previous quarter.Despite this,year-to-date take-up totalled 1.4m sq ft,slightly higher than the same period last year( 3%)and the highest since 2019.Take-up was also only 2low the five-year quarterly average of 608,400 sq ft Thames Valley(including West London)accounted for 61%of the quarterly take-up,totalling 362,600 sq ft.The M25 markets accounted for the remaining proportion,representing 39%of the total.The largest deal of the quarter saw the Premier League take 73,300 sq ft at One Olympia,London.Year-to-date,five transactions over 50,000 sq ft have completed The consumer services&leisure sector took the most space in Q2,accounting for 27%of the total take-up,followed by the TMT and manufacturing,industrial&energy sectorsSouth East Markets annual take-upSouth East Markets key deals Q2 2025South East Markets take-up by sector,12 months to end Q2 2025AddressMarketSize(sq ft)OccupierQualityOne Olympia,W14 Hammersmith73,300Premier LeagueNew Early Marketed6 Chiswick Park,Chiswick High Road,W4 Chiswick48,300WorleySecondhand1 Meadows Business Park,GU17Fleet34,800Leaders Romans GroupSecondhand1240 Arlington Business Park,RG7 Reading34,400Amentum TechnologiesSecondhandStoryboard,1 Farnham Road,GU2Guildford27,400Larian StudiosSecondhandMillions sq ftBanking&FinanceBusiness ServicesTMTConsumer Services&LeisureInsuranceManufacturing,Industrial&EnergyProfessionalPublic Sector57.00South EastPrime Rent8.6%South EastAvailability RateSource:CBRE ResearchSource:CBRE ResearchSource:CBRE Research10CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market Figures01234520082009201020112012201320142015201620172018201920202021202220232024202520262027CompletedUnder construction(speculative)Under construction(pre-let)10-year averageSouth East Markets Q2 2025 South East availability within units over 10,000 sq ft increased marginally from 16.5m sq ft at the end of Q1 to 17.1m sq ft in Q2( 4%).Supply remained well above the five-year quarterly average of 15.8m sq ft.Thames Valley contributed 62%of the total supply;accounting for 60%of Grade A space(6.3m sq ft)and 40%of Grade B space(4.2m sq ft)Secondhand space accounted for the largest proportion of supply at 12.6m sq ft(74%),followed by newly completed and new early marketed(supply that is not yet ready to occupy but will become so with 12 months)supply at 16%and 10%of the total,respectivelySouth East Markets development pipelineSouth East Markets availabilitySouth East Markets availability rates0246810121416182020052006200720082009201020112012201320142015201620172018201920202021202220232024Q2 2025SecondhandNew/early marketed10-year average012345678910200420052006200720082009201020112012201320142015201620172018201920202021202220232024Q2 2025Millions sq ft%Millions sq ftSource:CBRE ResearchSource:CBRE ResearchSource:CBRE Research11CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market FiguresAberdeen Aberdeen take-up totalled 101,200 sq ft in Q2,a 63%increase from the previous quarter and 22ove the long-term quarterly average level.The half-yearly take-up totalled 163,200 sq ft,78%higher than H1 2024 The largest deal of the quarter saw Altrad take 70,400 sq ft at The Apex,Howe Moss Crescent.This was the largest letting in the Aberdeen office market since Q1 2022 when Shell had acquired 100,000 sq ft at the The Silver Fin Building In the last 12 months,the manufacturing,industrial&energy services sector was the most active,representing 48%of the total take-up during the period,followed by the business services sector at 24%Availability totalled 1.6m sq ft at the end of Q2,falling 14%from the previous quarter.Occupiers continue to demand higher quality space,leading to the fall in supply of newly completed space to 3%of total availabilityAberdeen take-up by sector,12 months to end Q2 2025Aberdeen annual take-upAberdeen availability32.50AberdeenPrime Rent16.8erdeenAvailability Rate1$%9H%4%2.10.20.30.40.50.60.70.82015201620172018201920202021202220232024YTD 202500.51.01.52.02.53.02015201620172018201920202021202220232024Q2 2025Q1Q2Q3Q4SecondhandNew/early marketedMillions sq ftMillions sq ftBanking&FinanceBusiness ServicesTMTConsumer Services&LeisureInsuranceManufacturing,Industrial&EnergyProfessionalPublic SectorSource:CBRE ResearchSource:CBRE ResearchSource:CBRE Research12CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market Figures Take-up in Belfast totalled 81,800 sq ft in Q2 2025,representing a 41%increase quarter-on-quarter.This brought the H1 take-up to 139,600 sq ft,18low the same period last year Take-up was split across ten deals in Q2 with the average deal size at 8,200 sq ft,a significant increase from last quarter(5,300 sq ft)The business services sector was responsible for the largest share of take-up at 30%during the last 12 months,closely followed by the TMT sector at 26%Supply decreased 6%quarter-on-quarter to end Q2 at 1.2m sq ft.However,most of this space is Grade B/secondary type(64%)and will not have the sustainability credentials necessary for modern office occupiers and corporate occupiers.Supply of new/best-in-class space fell 21%quarter-on-quarter90&%3lfastBelfast take-up by sector,12 months to end Q2 2025Belfast annual take-upBelfast availability25.50BelfastPrime Rent13.0lfastAvailability Rate00.20.40.60.81.02015201620172018201920202021202220232024YTD 202500.40.81.21.62015201620172018201920202021202220232024Q2 2025Q1Q2Q3Q4SecondhandNew/early marketedMillions sq ftMillions sq ftBanking&FinanceBusiness ServicesTMTConsumer Services&LeisureInsuranceManufacturing,Industrial&EnergyProfessionalPublic Sector(incl.Charities)Source:CBRE ResearchSource:CBRE ResearchSource:CBRE Research13CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market FiguresBirmingham Birmingham take-up totalled 110,300 sq ft during the second quarter.The Q2 figure brought the H1 total to 184,100 sq ft,split across 38 individual deals.The H1 total was 50low the same period in 2024 The largest deal of the quarter saw Covalt Management Services take 27,000 sq ft at 1 Victoria Square.Five deals over 20,000 sq ft transacted during the last 12 months to Q2.Two of the five largest deals over the last 12 months were for newly completed space,demonstrating occupiers preference for high-quality space Public sector take-up during the last 12 months represented 30%of the total during the period.The next most active sector was business services,accounting for 20%of the total Supply fell by 9%during the quarter,to end Q2 at 2.4m sq ft.New/early marketed supply accounted for 37%of overall supply,while secondhand accounted for the remaining 63%Birmingham take-up by sector,12 months to end Q2 2025Birmingham annual take-upBirmingham availability45.50BirminghamPrime Rent14.0%BirminghamAvailability RateQ1Q2Q3Q4SecondhandNew/early marketed3 %8%5%30%Millions sq ftMillions sq ft00.20.40.60.81.01.22015201620172018201920202021202220232024YTD 202500.51.01.52.02.53.02015201620172018201920202021202220232024Q2 2025Banking&FinanceBusiness ServicesTMTConsumer Services&LeisureInsuranceManufacturing,Industrial&EnergyProfessionalPublic SectorSource:CBRE ResearchSource:CBRE ResearchSource:CBRE Research14CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market FiguresBristol Take-up totalled 115,900 sq ft in Q2,increasing by 25%from the previous quarter.Despite the quarterly increase,take-up stood 5low the five-year quarterly average.This brought the H1 total to 208,900 sq ft,13low the same period in 2024 Take-up was spread over 24 transactions.The largest deal of the quarter saw Unite Students take 22,000 sq ft at Welcome Building,Avon Street The business services sector has been responsible for the largest share of take-up in the last 12 months,accounting for 32%of the total,followed by the professional sector at 23%Availability fell by 3%quarter-on-quarter,ending the quarter at 1.2m sq ft.Despite the fall,it continued to remain above the five-year quarterly average of 1.1 sq ft Secondhand and newly completed supply accounted for 48%and 47%of the total supply,respectively.While secondhand supply increased by 2%compared to the previous quarter,and newly completed supply increased by 12%,new early marketed supply fell by 62%quarter-on-quarter to accounted for 5%of the totalBristol take-up by sector,12 months to end Q2 2025Bristol annual take-upBristol availability49.00BristolPrime Rent13.6%BristolAvailability RateQ1Q2Q3Q4SecondhandNew/early marketedMillions sq ftMillions sq ft62%8%8%4#%8.10.20.30.40.50.60.70.82015201620172018201920202021202220232024YTD 202500.20.40.60.81.01.21.41.62015201620172018201920202021202220232024Q2 2025Banking&FinanceBusiness ServicesTMTConsumer Services&LeisureInsuranceManufacturing,Industrial&EnergyProfessionalPublic SectorSource:CBRE ResearchSource:CBRE ResearchSource:CBRE Research15CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market Figures3t%2%8mbridge Office take up in H1 was 255,700 sq ft,a 47%increase on the same period last year and strongest H1 since 2019.Take-up in Q2 totalled 133,300 sq ft,representing a 9%rise from the previous quarter and 58ove the five-year quarterly average of 84,400 sq ft.This was also the strongest Q2 since 2019 There were 15 deals in Q2.The largest letting of the quarter saw B take 22,700 sq ft at Matrix House,10 Cowley Road.In the 12 months to Q2,the TMT sector was the most active,accounting for 74%of take-up.The next most active sector was consumer services&leisure,representing 13%of take-up during the period Availability increased by 21%quarter-on-quarter to 1.3m sq ft.The increase in total availability was mainly driven by new early marketed supply,which increased from 27,500 sq ft to 270,900 sq ft during the quarter.Despite the increase in new early marketed supply,secondhand space accounted for the largest proportion,accounting for 70%of the total supply,followed by new early marketed and newly completed supply at 21%and 9%,respectivelyCambridge take-up by sector,12 months to end Q2 2025Cambridge annual take-upCambridge availability62.00CambridgePrime Rent11.6mbridgeAvailability RateBanking&FinanceBusiness ServicesTMTConsumer Services&LeisureInsuranceManufacturing,Industrial&EnergyProfessionalPublic SectorQ1Q2Q3Q4SecondhandNew/early marketedMillions sq ftMillions sq ft00.20.40.60.81.01.21.42015201620172018201920202021202220232024Q2 20250.00.10.20.30.40.50.62015201620172018201920202021202220232024YTD 2025Source:CBRE ResearchSource:CBRE ResearchSource:CBRE Research16CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market FiguresEdinburgh Q2 take-up totalled 125,800 sq ft in Edinburgh,a 12%rise from Q2 2024,but 27low the five-year quarterly average of 172,400 sq ft.Take-up for H1 totalled 226,500 sq ft,8low the same period last year In the year-to-date,most of the leasing activity has been recorded in the sub 5,000 sq ft market,where 64 deals took place.This equated a market share of 53%of all the deals during H1 2025.There were two transactions over 10,000 sq ft in Q2.The largest involved take-up of 29,700 sq ft at Waverley Gate,2-4 Waterloo Place by Wood MacKenzie.The second largest deal of the quarter involved the law firm,Addleshaw Goddard taking 28,600 sq ft at 24 St Andrew Square The banking&finance sector was the most active over the last 12 months,representing 38%of total take-up,followed by the TMT sector at 15%,and the professional sector at 13%Availability fell by 1%quarter-on-quarter to stand at 2.0m sq ft.The availability of new/new early marketed supply remained limited,accounting for only 4%of the totalEdinburgh take-up by sector,12 months to end Q2 2025Edinburgh annual take-upEdinburgh availability46.50EdinburghPrime Rent10.9inburghAvailability RateQ1Q2Q3Q4SecondhandNew/early marketedMillions sq ftMillions sq ft00.20.40.60.81.01.22015201620172018201920202021202220232024YTD 202500.51.01.52.02.52015201620172018201920202021202220232024Q2 202538%8%4%4%6nking&FinanceBusiness ServicesTMTConsumer Services&LeisureInsuranceManufacturing,Industrial&EnergyProfessionalPublic SectorSource:CBRE ResearchSource:CBRE ResearchSource:CBRE Research17CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market FiguresGlasgow Glasgow take-up totalled 106,700 sq ft in Q2,a 32ll from the Q1 figure and 17%down on the five-year quarterly average.This brought the H1 total to 263,300 sq ft,7%higher than the same period last year,and the highest H1 figure since 2020 There were four leasing deals larger than 10,000 sq ft in Q2.One of the key deals during the quarter involved take-up of 15,000 sq ft at 191 West George Street by Beam Suntory.The next key deal involved the law firm,Addleshaw Goddard taking 11,600 sq ft at 151/155 St Vincent Street In the last 12 months,the professional sector was the most active,accounting for 24%of take-up,followed by the business services sector at 22%Total supply decreased by 12%,quarter-on-quarter to 2.3m sq ft.Grade A supply remained very low,accounting for just 21%of available office stock at the end of the quarter.Secondhand space continued to dominate supply,accounting for 90%of the totalGlasgow take-up by sector,12 months to end Q2 2025Glasgow annual take-upGlasgow availability41.50GlasgowPrime Rent9.8%GlasgowAvailability RateQ1Q2Q3Q4SecondhandNew/early marketedMillions sq ftMillions sq ft00.20.40.60.81.01.21.41.61.82015201620172018201920202021202220232024YTD 202500.51.01.52.02.53.03.52015201620172018201920202021202220232024 Q2 20258%4%2 $nking&FinanceBusiness ServicesTMTConsumer Services&LeisureInsuranceManufacturing,Industrial&EnergyProfessionalPublic SectorSource:CBRE ResearchSource:CBRE ResearchSource:CBRE Research18CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market FiguresLeeds Take-up totalled 84,300 sq ft in Leeds during Q2,representing a quarterly fall of 65%and standing 45low the five-year quarterly average of 152,300 sq ft.The H1 take-up totalled 325,400 sq ft,7%lower than the same period in 2024 There were three deals over 10,000 sq ft during Q2.The largest deal involved the take-up of 17,100 sq ft at No 1 Whitehall Riverside by JN Bentley In the last 12 months,the consumer services&leisure sector was the most active,accounting for 41%of the total take-up during the period,followed by the business services sector at 21%Availability fell marginally during the quarter to 1.5m sq ft(-1%)and below the five-year quarterly average(-4%).Secondhand space accounted for the largest share of total supply at 83%,followed by newly completed and new early marketed supply accounting for 16%and 1%of the total,respectivelyLeeds take-up by sector,12 months to end Q2 2025Leeds annual take-upLeeds availability42.50LeedsPrime Rent11.9%LeedsAvailability RateQ1Q2Q3Q4SecondhandNew/early marketedMillions sq ftMillions sq ft00.20.40.60.81.01.22015201620172018201920202021202220232024YTD 202500.40.81.21.62.02015201620172018201920202021202220232024Q2 20258!A%4%2%7%3nking&FinanceBusiness ServicesTMTConsumer Services&LeisureInsuranceManufacturing,Industrial&EnergyProfessionalPublic SectorSource:CBRE ResearchSource:CBRE ResearchSource:CBRE Research19CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market FiguresLiverpool A total of 51,600 sq ft transacted during Q2 in Liverpool across 15 leasing deals,a 116%increase from Q2 2024.This also represented an increase from Q1,which saw occupiers take 36,300 sq ft.Despite the quarter-on-quarter increase,take-up was 17low the five-year quarterly average.H1 take-up totalled 87,900 sq ft,27low the same period in 2024 The professional sector was the most active in the 12 months to Q2,accounting for 26%of take-up,closely followed by the insurance sector at 25%The largest deal of the quarter saw Liverpool John Moores University take 24,400 at City Square,40 Tithebarn Street Availability increased by 8%during the second quarter to stand at 904,600 sq ft.Secondhand space accounted for majority of supply at 92%,while newly completed space accounted for only 8%of the total.Grade A availability rate stood at 2.9%Liverpool take-up by sector,12 months to end Q2 2025Liverpool annual take-upLiverpool availability35.00LiverpoolPrime Rent16.0%LiverpoolAvailability RateQ1Q2Q3Q4SecondhandNew/early marketedMillions sq ftMillions sq ft8%8%5%&.10.20.30.40.50.60.70.82015201620172018201920202021202220232024YTD 202500.20.40.60.81.01.21.41.62015201620172018201920202021202220232024Q2 2025Banking&FinanceBusiness ServicesTMTConsumer Services&LeisureInsuranceManufacturing,Industrial&EnergyProfessionalPublic SectorSource:CBRE ResearchSource:CBRE ResearchSource:CBRE Research20CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market Figures241%1%3%6%Manchester Take-up in Manchester totalled 261,500 sq ft in Q2,an 18crease from the Q1 total and 3low the five-year quarterly average.A total of 49 deals transacted during the quarter;eight of which were greater than 10,000 sq ft The Q2 figure brought the year-to-date take-up to 581,100 sq ft,14%higher than H1 2024 and the highest since 2019.The largest deal of the quarter saw Softcat take 35,400 sq ft of space at Manchester Goods Yard,Studio Way In the 12 months to end-Q2,the TMT sector accounted for largest share of take-up at 31%.The banking&finance sector was also active,accounting for 24%of total take-up for the period Availability in Manchester decreased marginally(-2%)to total 4.5m sq ft at the end of Q2,much of which comprised of Grade B and C space.The availability of new/early marketed space remained low accounting for just 18%of available supply at the end of the quarterManchester take-up by sector,12 months to end Q2 2025Manchester annual take-upManchester availability45.00ManchesterPrime Rent17.7%ManchesterAvailability RateQ1Q2Q3Q4SecondhandNew/early marketedMillions sq ftMillions sq ft00.40.81.21.62.02015201620172018201920202021202220232024YTD 202501.02.03.04.05.02015201620172018201920202021202220232024Q2 2025Banking&FinanceBusiness ServicesTMTConsumer Services&LeisureInsuranceManufacturing,Industrial&EnergyProfessionalPublic SectorSource:CBRE ResearchSource:CBRE ResearchSource:CBRE Research21CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market Figures Oxford take-up totalled 54,400 sq ft during the second quarter,a significant increase from Q1,which was at 14,500 sq ft.The Q2 figure brought the H1 total to 68,900 sq ft,48%lower than the same period last year The largest deal of the quarter saw Oxfam take 26,500 sq ft at Centrica Building,John Smith Drive Three deals over 20,000 sq ft transacted in the 12 months to Q2,the largest of which was new/early marketed space,demonstrating occupiers preference for high-quality space Supply increased by 10%quarter-on-quarter,to stand at 1.5m sq ft.New early marketed space accounted for the largest share of supply at 42%,increasing by 28%quarter-on-quarter.Newly completed space accounted for 17%of total supply,increasing by 4%during the quarter,while secondhand space accounted for the remaining 41%,falling by 3%quarter-on-quarter OxfordOxford take-up by sector,12 months to end Q2 2025Oxford annual take-upOxford availability63.50OxfordPrime Rent34.7%OxfordAvailability RateBanking&FinanceBusiness ServicesTMTConsumer Services&LeisureInsuranceManufacturing,Industrial&EnergyProfessionalPublic SectorQ1Q2Q3Q4SecondhandNew/early marketedMillions sq ft00.20.40.60.81.01.21.41.62015201620172018201920202021202220232024Q2 20250501001502002503003504002015201620172018201920202021202220232024YTD 2025000s sq ft5%9%5D%7%Source:CBRE ResearchSource:CBRE ResearchSource:CBRE Research22CBRE RESEARCH 2025 CBRE,INC.UK OFFICE|Q2 2025UK Office Market Figures There were four leasing deals in Southampton in Q2,totalling 65,200 sq ft,representing a significant increase on the on the five-year quarterly average( 163%)and an increase from the previous quarter( 252%).This brought the H1 total to 83,700 sq ft,250%higher than the same period last year,and highest half-yearly total since 2022 The largest deal of the quarter involved Aviva Central Services taking 38,200 sq ft of space at Ageas House,Hampshire Corporate Park In the 12 months to Q2,the insurance sector was the most active,accounting for 32%of take-up.The next most active sector was the professional sector,accounting for 27%of total take-up At the end of Q2,City Centre overall supply stood at 318,800 sq ft,while Grade A availability remained limitedSouthamptonSouthampton take-up by sector,12 months to end Q2 2025Southampton annual take-upSouthampton availability30.00SouthamptonPrime Rent6.4%SouthamptonAvailability RateBanking&FinanceBusiness ServicesTMTConsumer Services&LeisureInsuranceManufacturing,Industrial&EnergyProfessionalPublic SectorQ1Q2Q3Q4SecondhandNew/early marketed000s sq ftMillions sq ft00.10.20.30.40.50.60.70.80.92015201620172018201920202021202220232024Q2 20250204060801001201401601802002015201620172018201920202021202220232024YTD 202511%5%22%4%8%Source:CBRE ResearchSource:CBRE ResearchSource:CBRE ResearchUK OFFICE|Q2 2025UK Office Market Figures ReportLondon CityInvestor LeasingDave Perowne 44 207 182 3235David.P Capital MarketsRob Jackson 44 78416 84928Rob.J London West EndInvestor Leasing&OccupierAdam Cosgrove 44 207 182 2713Adam.C Capital MarketsEd Bradley 44 207 182 2195Ed.BSouth East/Thames Valley/M25 Investor LeasingPeter York 44(0)207 182 3280Peter.Y OccupierSophie Fazakerley 44 207 182 3420Sophie.FCapital MarketsLondon Office ContactsJames Delliere 44 207 182 8121James.D UK OFFICE|Q2 2025UK Office Market Figures ReportAberdeenInvestor LeasingDerren McRae 44 1224 219 025Derren.MAmy Tyler 44 1224 219 034Amy.TBelfast(part of the affiliate network)Investor LeasingDavid Wright 44 289 043 6745David.W Capital MarketsRobert Ditty 44 289 043 6917Robert.D Cities ContactsBirminghamInvestor LeasingTheo Holmes 44 121 616 5510Theo.H Capital MarketsNick Woodward 44 121 616 5561Nick.W BristolInvestor LeasingRichard Kidd 44 117 943 5768Richard.K Capital MarketsTom Morris 44 117 943 5754Tom.M EdinburghInvestor LeasingAngela Lowe 44 131 243 4189Angela.L Capital MarketsSteven Newlands 44 131 469 7666Steven.NUK OFFICE|Q2 2025UK Office Market Figures ReportGlasgowInvestor leasingSarah Hagen 44 7468724253Sarah.H Capital MarketsMartyn Brown 44 141 204 7703Martyn.B LeedsInvestor leasingAlex Hailey 44 113 394 8814Alex.H Capital MarketsAlex Whiting 44 113 394 8810Alex.W Cities ContactsLiverpoolInvestor LeasingNeil Kirkham 44 151 471 4933Neil.K Capital MarketsWill Kennon 44 161 233 5609William.K ManchesterInvestor LeasingJoe Rigby 44 161 233 5636Joseph.R Capital MarketsWill Kennon 44 161 233 5609William.K SouthamptonInvestor Leasing/Capital MarketsJames Brounger44 238 020 6336James.B Emma Lockey 44 238 020 6312Emma.L Oxford Investor LeasingKevin Wood 44 186 584 8488Kevin.WCapital MarketsJohn Knight 44 7768 927 578John.K CambridgeInvestor leasingEmma Stratton 44 7825 204 325Emma.SCapital MarketsJohn Knight 44 7768 927 578John.K UK OFFICE|Q2 2025UK Office Market Figures ReportNote on metrics used in this publicationAvailability figures include space which will become ready-to-occupy within 12 months as well as space available for immediate occupation.Availability rate is a function of total availability and stock,vacancy rate is a function of ready-to-occupy availability and stock.Prime rents assumes a hypothetical 10-15,000 sq ft unit,2nd-4th floor,in the best building,offered in a Landlords refurbished CAT A condition,but reflective of the age of the building whilst assuming a new contemporary reception and common parts.South East(including Oxford)units over 10,000 sq ft,Southampton units over 4,000 sq ft,Edinburgh availability rate city wide.New/grade A availability rate is a function of newly completed/grade A availability and total stock For the South East(including Oxford and Cambridge)markets CBRE tracks offices and lab-enabled space,but not buildings offering purely lab space Copyright 2025.All rights reserved.This report has been prepared in good faith,based on CBREs current anecdotal and evidence based views of the commercial real estate market.Although CBRE believes its views reflect market conditions on the date of this presentation,they are subject to significant uncertainties and contingencies,many of which are beyond CBREs control.In addition,many of CBREs views are opinion and/or projections based on CBREs subjective analyses of current market circumstances.Other firms may have different opinions,projections and analyses,and actual market conditions in the future may cause CBREs current views to later be incorrect.CBRE has no obligation to update its views herein if its opinions,projections,analyses or market circumstances later change.Nothing in this report should be construed as an indicator of the future performance of CBREs securities or of the performance of any other companys securities.You should not purchase or sell securitiesof CBRE or any other companybased on the views herein.CBRE disclaims all liability for securities purchased or sold based on information herein,and by viewing this report,you waive all claims against CBRE as well as against CBREs affiliates,officers,directors,employees,agents,advisers and representatives arising out of the accuracy,completeness,adequacy or your use of the information herein.Rob MaddenExecutive Director,Head of UK Leasing 44(0)7879 443 706Rob.MAndy Monighan Executive Director,Head of London Investor Leasing&Occupier Brokerage 44 207 1822 713Andrew.M John OgdenManaging Director,Head of UK Regional Markets 44 161 233 5612John.OTasos VezyridisExecutive Director,Head of ResearchUK&I and Continental Europe 44 7342 079 387Tasos.VSimon D BrownHead of UK Office Research 44 207 182 3993SimonD.B Corinne VrensenSenior Analyst,UK Office Research 44 207 182 2834Corinne.VYukti SinghSenior Analyst,UK Office Research 44 207 182 2052Yukti.SCBRE UK Offices Contacts
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