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Rental cost remained as the most important consideration when selecting an office space last year for tenants in the region, especially in land-scarce Singapore and Hong Kong, according to Knight Frank’s latest Asia Pacific Office Occupier Survey, which polled over 200 companies.
“2016 was a difficult year for many businesses around the region, and this was reflected by the findings in our survey. Faced with economic uncertainty and increased competition, more respondents chose rent as their most important building selection criteria than ever before,” said Marcus Burtenshaw, Head of Commercial of Knight Frank Thailand.
In fact, it retained its position as the most paramount criteria for occupiers for the third consecutive year since the first edition of the annual study in 2013.
Ranked from the most vital, the other factors taken into account by tenants when choosing an office space are image, nearness to mass transit, proximity to amenities, client location, closeness to employees’ homes, staff retention, security and lastly, the building’s green credentials.
In Indonesia and Thailand, frequent traffic congestion caused companies to place greater value on nearness to mass transit, while occupiers in Beijing and Shanghai rated proximity to clients as the most important criteria to avoid long travel times between meetings due to usual traffic jams there.
A building’s green credential was the least prioritised by occupiers across the region, except in China, where it ranked in the middle after access to amenities, as the Chinese are increasingly conscious about the effects of pollution.
Meanwhile, the survey revealed that most tenants (43.2 percent) prepare for their next lease six months before the current one ends, while 34.5 percent do it 12 months in advance.
Knight Frank advises occupiers to review their options at least one year before their lease expires, as the former leaves them with insufficient time to “find, secure, and decorate an alternative location,” Burtenshaw added.
Christopher Chitty, Senior Content Specialist at PropertyGuru, edited this story. To contact him about this or other stories, email christopher@propertyguru.com.sg
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