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By APD writer Chen Jiabao
**BANGKOK, June 5 (APD) ** -- Bangkok tops 20 Asian cities with a staggering year-on-year rental growth of 9.6% during the first quarter of 2017, according to the Knight Frank Asia-Pacific Prime Office Rental Index.
The index shows that rents in the Thai capital have been on the rise for more than two years and are expected to persist due to strong absorption amidst tight supply.
The index, released on Monday by Knight Frank, an independent property consultancy, has compared rent hikes at prime office markets across 20 global cities between the first quarter of 2017 and 2016.
Knight Frank's executive director Marcus Burtenshaw credited the sharp growth of rents in Bangkok to strong growth in Thailand's service sector and a generally unremarkable macroeconomic climate.
A property agency’s research unit, CBRE Research, has reported earlier that although office supply in Bangkok has expanded by 140,000 square metres, vacancy has continued to fall to eight per cent and rents are therefore expected to rise by 5-9 per cent this year, depending on location and grade.
The research shows that the office-vacancy rate dropped, for the first time since the early 1990s, to below 10 per cent in 2013, and has continued to fall since.
Marcus said tenants, faced with the reality of higher rents, are increasingly demanding more from their buildings. Despite of good access to mass transit, grand lobbies or high ceilings, tenants want more natural light, improved security systems and quality food outlets that cater to the budgets of all of their employees.
Knight Frank recommends tenants to review their options at least 12 months before their lease expires, providing time to conduct renewal negotiations and if needed, still provide time to find, secure and decorate an alternative location.
(ASIA PACIFIC DAILY)
