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Colliers International has been appointed as sole leasing representative for Sule Square (pictured), a Grade ‘A’ 30,000 sqm office tower in the heart of downtown Yangon, Myanmar.
Commenting on the market in Myanmar in general, Dennis Yeo, Interim Chief Executive Officer of Asia, said: “Colliers is optimistic about this reform-embracing country and was the first international real estate services company to enter the Myanmar market two years ago.
“We believe the ASEAN integration will stimulate the inbound capital, eventually fuelling businesses and increasing our client’s demand for office space. The economy is also witnessing an early stage of expansion, which will drive further growth in various investment sectors.”
Sule Square is due for completion early in 2016 and is being developed by Shangri-La Hotels and Resorts, Asia-Pacific’s leading luxury hotel group with an existing presence in Yangon since 1995.
This modern Grade ‘A’ commercial complex, the first development in Yangon, will offer 15 floors, each covering 2,000 sqm of space.
According to Colliers International Yangon Research and Forecast Q4 2014 report, there is only 38,000 sqm of top-tier office space in Yangon. During 2015 new supply is estimated to reach more than 60,000 sqm, more than twice that of 2014. While many better-quality office options are now underway, there remains an absence of proper international Grade ‘A’ buildings in Yangon, according to the real estate firm.
“Finding office space is a headache for multinational companies looking to set up operations in Myanmar,” said Tony Picon, Managing Director of Colliers International in Myanmar.
“The occupancy rate continued to improve in Q4 2014, albeit at a modest rate of 0.44 percent from the previous quarter.
“On an annual basis demand is high, registering a 9 percent increase in net take-up from 2013’s 26,000 sqm. The entry of new investors, particularly foreign banks and securities companies, will help buoy the take-up rate.”
Citywide monthly average office rental rates ended last year at US$69.17 per sqm, a slight increase from Q3. The forecast direction for the citywide average rent remains upward in 2015, albeit at a more modest rate than witnessed in the past two years.
Colliers asserts that the lack of international-standard office buildings will keep premium rental rates relatively stable.
Andrew Batt, International Group Editor of PropertyGuru Group, wrote this story. To contact him about this or other stories email andrew@propertyguru.com.sg