Flexible work arrangements to have “muted” impact on demand
According to the CATCH ‘22 Asia Pacific Commercial Real Estate Outlook 2022 report by Cushman & Wakefield, the Asia Pacific office sector has demonstrated extraordinary resilience since the dawn of the outbreak, stating that it is “the only region to record consecutive quarters of positive net absorption”.
As corporate occupiers make decisions based on corporate footprints, office demand is projected to rise. By end of this year, demand is anticipated to reach 74 million square feet (msf) before reverting to pre-pandemic levels of roughly 832 msf in 2023.
Though C&W expects businesses across Asia Pacific to incorporate flexible working schemes, the impact on demand will be somewhat “muted” as employees in the region are less in favour of the flexible work setup compared to those in Europe and the U.S.
Looking ahead, the firm predicts the growth of employment and the shift to a bigger ratio of office-based labour to compensate for the current impact of remote working.
For a more indepth outlook, the report shared that India’s biggest cities are set to witness a surge in demand following last year’s prolonged decision making. Singapore and Bangkok are also displaying great progress driven by the resurging demand in the second half of 2021, which will most likely continue this year as more employees report to the office.
Australian cities will be experiencing a more modest growth since the tug on remote working will be more evident, resulting in some office occupiers merging their premises by 20 percent. Seoul will have a more subdued demand as a result of limited new supply, tight vacancy, and solid growth in 2021; as will Tokyo after logging unfavourable demand of around 1.6 msf in 2021. Meanwhile, Mainland China will go through a slight decline from its 2021 record figures.
The Property Report editors wrote this article. For more information, email: [email protected].
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