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The central business district (CBD) or the city fringe is anticipated to become a more sought-after location for tech companies over time, as the area is among the top places to access and retain talent, according to a report from Colliers International.
“It is conceivable that some companies may be forced to move towards the CBD or the CBD fringe to be near the talent pool afforded by large urban centres,” said Andrew Haskins, the property consultancy’s executive research director for Asia.
“A prime office location may also help firms gain a competitive edge in attracting and retaining talents, since the workforce is increasingly dominated by millennial employees who desire easy access to amenities such as bars and restaurants, as well as public transport,” he added.
On the other hand, business parks on the city fringe are an option for smaller firms or start-ups. For manufacturing divisions, different economic criteria apply as sites outside the cities are practical for them.
But tech companies trying to concentrate all their operations in remote campus sites are unlikely to attract skilled personnel, like experts in IT, internet and hardware, which are considered important roles for the future.
Moreover, the third edition of JLL’s Premium Office Rent Tracker (PORT) revealed that tech companies are more willing to splurge on high-quality prime office space.
“We continue to see a greater number of companies from the technology sector targeting premium buildings to attract top talent and to enhance their brand image,” said Jeremy Sheldon, JLL Asia Pacific’s managing director for markets and integrated portfolio services.
In fact, he noted that a significant number of tech firms in Asia Pacific are upgrading their premises from Grade B to Grade A, while some are shifting from serviced to proper offices.
Meanwhile, the PORT shows that Singapore took 14th spot for the most expensive office location in Asia Pacific with a total occupancy cost of US$84 psf per annum as of Q3 2017.
On the other hand, Delhi, Beijing’s Finance Street and central Hong Kong secured the top three regional spots, with respective rents of US$147 psf, US$190 psf and US$323 psf.
This article was edited by Keshia Faculin.
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