Office occupiers prefer to upgrade their office space in core locations when relocating
Most Core
Location
26%
Most Decentralised
46%
32%
19%
Asset quality
Substantially Upgrade
Substantially Downgrade
Relocation Focus on Quality Offices
#1
Employee preference for core locations
Top 5 Reasons to
Drive Flight to Quality
#2
Need for workplace transformation
#3
Demand for green buildings
#4
Improving office availability
#5
Tenant-favoured market
Hong Kong SAR
Flight to Quality in Asia Pacific
Singapore
Australia
Mainland China
Japan
Korea
India
Building
Upgrade
Flight to core
Flight
to green
Prime offices enjoy a much higher occupancy rate than general Grade A offices
Impact on Occupancy
As of Q1 2024 Asia Pacific office occupancy was
in prime offices
in Grade A offices
VS
>90%
>90%
>90%
>71%
>66%
>61%
>55%
>42%
>33%
>24%
>18%
>00%
>90%
~80
~80%
~80%
~75%
~69%
~66%
~51%
~48%
~32%
~27%
~15%
~00%
~80%
100
105
110
115
120
125
Prime Rent Index
Grade A Rent Index
2013 Q1
Impact on Rents
Rental performance of prime offices is more resilient than general Grade A offices
Index Q1 2013 = 100
2014 Q1
2015 Q1
2016 Q1
2017 Q1
2018 Q1
2019 Q1
2020 Q1
2021 Q1
2022 Q1
2023 Q1
2024 Q1
Rental change since pandemic
-2.1%
-7.1%