Beijing’s leasing market growth weakened at the beginning of 2022 which resulted in increased pressure on landlords in the short term. A seasonal factor such as the Spring Festival as well as the Winter Olympic Games coupled with the embattled IT sector all contributed to the slow growth. 

Two new projects were launched in Q1/2022, adding a total of 161,600 sq m to the Grade A offi ce market. The new supply and weak take-up caused the citywide vacancy rate to increase 0.3 ppts QoQ to 15.3% while the Grade A offi ce rent fell 0.6% QoQ to an average of RMB339 per sq m per month.

Compared with last year, the proportions of top demand drivers for Grade A offices including fi nance, IT and healthcare industries had changed in Q1/2022. Owing to the impact of government regulations, demand from the IT sector weakened, however, the fi nance sector continued to expand during the same period.