Commercial property transactions hit 15-year high in Q2

Taipei, Transactions of commercial property in Taiwan hit a 15-year high in the second quarter of this year, according to commercial real estate services and investment firm CBRE Group Inc.

Data compiled by CBRE shows that sales of commercial property in Taiwan during the April-June period totaled NT$77.9 billion (US$2.55 billion), the highest level since the advisory firm started to release its statistics in 2003.

CBRE said the second-quarter transactions rose 165 percent from a year earlier, largely on the back of strong interest from many innovative start-ups.

Out of the NT$77.9 billion-worth of transactions, NT$33.3 billion in sales value came from transactions of shops, factories or offices, up 154 percent from a year earlier, while the remaining NT$44.6 billion came from land transactions, up 173 percent from the previous year, the data shows.

In the second quarter, CBRE said, the Neihu Technology Park in Taipei became a popular designation for commercial property investors, with transactions for the second quarter hitting NT$24.6 billion.

Among the major buyers, Formosa Plastics Group, one of the leading conglomerates in Taiwan, spent NT$18.7 billion on a property in the technology park as its headquarters in Taipei, CBRE said.

CBRE said there is about NT$30 billion-worth of commercial property up for sale in Neihu, so it is possible that the district will remain a hot spot for high transactions.

As for land transactions, CBRE said that one Taiwanese property developer purchased a large plot of land with a total area of more than 1,000 pings (one pings equals 3.3 square meters) to boost the entire commercial property sales in the second quarter.

In terms of the office rental market in Taipei, the most closely watched property market in Taiwan, CBRE said, with large and medium-sized companies moving to or setting up offices in Taipei, a total of 10,133 pings of A-grade offices in Taiwan was leased in the second quarter. Due to the higher demand, the average rent for A-grade offices in Taipei rose 1.3 percent from a quarter earlier to NT$2,673 per ping in the second quarter, CBRE said.

CBRE said the service sector accounted for the largest tenants in the commercial property rental market in Taipei, accounting for 39 percent of the total rented property, ahead of information/Internet firms (15 percent) and financial/insurance business owners (12 percent).

The advisory firm said that innovative start-ups, such as developers of electric cars, artificial intelligence technology and blockchain used as a platform for digital transactions, also demanded large commercial property in the Taipei rental market in the three- month period.

The advisory firm added that these innovative start-ups are expected to remain one of the major customers in the Taipei commercial property rental business at a time when the government is lending its support to new technology development.

Source: Focus Taiwan News Channel