Property mart shines in SE Asian states
Property mart shines in SE Asian states
SINGAPORE (AFP): Growth in Asia's property market this year will be driven mostly by Malaysia, Thailand, Singapore and Indonesia, according to international property consultants Jones Lang Wootton (JLW) yesterday.
"The year looks promising for property investment (in these four Southeast Asian countries)," Nigel Raymond, chairman of JLW Asia said in a regional property market report released in Singapore.
Raymond said that the performance of Asia's property markets as a whole was strong in 1994, underpinned by an average annual economic growth of 7.5 percent, greater intra-regional trade and development of the services sector.
"The performance of the various markets at regional level has been diversified ... nevertheless a common characteristic is increased end-user demand in all sectors," he said.
The report said that Malaysia, which held up well in 1994 in spite of some pressure from increasing supply in certain sectors, would experience healthy growth this year, especially in the residential market.
It cautioned however that the country's heavy supply of hotel, retail and office space coming on stream in 1996 would need to be watched.
JLW said that Thailand's economic expansion allowed increased supply of property without adversely affecting values or rental levels but there was a danger of oversupply in some sectors in Bangkok.
Office vacancies have fallen marginally in central Bangkok to around 20 percent while rentals and prices in the Thai capital compared very favorably with other cities in Asia such as Hong Kong and Singapore, it said.
In Singapore, where total investment sales reached US$4.48 billion at the end of 1994, JLW expects both rents and capital values of offices to improve further.
Office space occupancy in the prime Raffles Place business district ballooned to almost 100 percent with island-wide occupancy averaging 97 percent, according to the report.
Jakarta
JLW said that Jakarta, Indonesia's capital, still had a full supply of office space with heavy supply forecast for 1996 but attractive rental levels for prime space attracted many tenants.
"This has led to an improvement in the average occupancy levels with vacancies decreasing to 7.8 percent as at December 1994," it said.
With continued interest from international companies, JLW said prospects for office and luxury residential in Indonesia appeared optimistic for 1995.
Raymond said however that Hong Kong, China, Taiwan and Japan will face more property market uncertainties this year.
Japan, whose office market has suffered from a shortage of tenants and declining rents since early 1993, would continue to grapple with its domestic economic problems, he said.
In Taiwan, JLW said hopes of a surge in property demand, driven by the relaxation of rules pertaining to foreign financial and securities firms, were hindered by zoning regulations limiting where these companies can establish offices and obtain formal business licenses.