Mingtiandi

Asia real estate and outbound investment news

  • Facebook
  • LinkedIn
  • RSS
  • Twitter
Sign Up / Login Logout

Lost your password?
Register
Forgotten Password
Cancel

Register For This Site

A password will be e-mailed to you.

  • Capital Markets
  • Events
    • 2021 Mingtiandi Event Calendar
    • Join the Mingtiandi Asia Value-Add Forum 2021
    • Join the Mingtiandi Multi-Family Investment Forum 2021
    • Join the Mingtiandi Logistics Real Estate Forum 2021
    • Join the Mingtiandi Sustainable Real Estate Forum 2021
    • Join the Mingtiandi Data Centre Forum 2021
    • Join the Mingtiandi Office Strategies Forum 2021
    • Join the Mingtiandi Proptech Forum in November
    • More Events
  • MTD TV
  • People
  • Logistics
  • Asia Outbound
  • Retail
  • Design & Construction
  • Research & Policy
  • Advertise

Asian Occupiers and Investors Prepare for the Future of the Workplace Sponsored Feature

2020/09/04 by Platform Sponsor Leave a Comment

COVID-19 has transformed economic and public health expectations, with real estate markets, including the office sector, having been disrupted this year along with most other aspects of life.

With many companies forced to adopt remote working approaches in the short term and concerns over wellness expected to last over the long term, corporate planners are struggling to imagine their future office needs as markets start to recover.

While profound changes in corporate use of commercial premises are already underway, The Future of the Office Space Report published recently by the Asia Pacific team of Colliers International sheds light on what occupiers and investors can expect from office markets around the region in the coming months and years.

Markets Start to Emerge from COVID-19

The report, which was based on analysis by Colliers’ office market business lines and research teams, examines the impact of COVID-19 on office fundamentals, maps out an emerging new concept of office space – including the role of flexible workspace – and also explores investor sentiment about office assets during a time of resetting expectations.

Andrew Haskins Colliers International

Andrew Haskins, Head of Research for Asia at Colliers International

Looking at the office leasing market around the region in aggregate, Colliers expects demand to stay under pressure till mid-2021, while supply of space should stay high. Consequently, according to the report’s authors, “we expect a period of two to three years in which many APAC office markets will record above longer-term average vacancy levels.”

However, the medium-term outlook for office markets is brighter. “Office leasing demand already seems to be picking up in China, particularly in the TMT sector,” said Colliers’ Head of Research for Asia, Andrew Haskins, while predicting that requirements for office premises should stay firm over time in Bangalore, the city with APAC’s highest long-run growth prospects and a major technology centre.

“We are optimistic about a medium-term recovery in office absorption in Singapore, which is increasingly emerging as one of Asia’s most popular tenant locations, while in Hong Kong SAR local and mainland Chinese demand should offset possible lower demand from multinational groups,” Haskins added, noting that Tokyo can also expect steady demand due to ongoing interest from corporate occupiers, despite greater signs that demand has been impacted by a shift to remote working in the technology sector than in other Asian cities.

Office Role Endures

With offices set to reopen, Colliers expects many companies to be taking a fresh look at how they use their space, while expecting that the basic function of the office in company workflows will remain intact.

Sam Harvey Jones

Sam Harvey-Jones of Colliers International

“The office will retain a key role in corporate real estate strategy, but we expect that some firms will shift to a more diverse and employee choice-based real estate strategy,” Sam Harvey-Jones, Colliers’ Managing Director for Occupier Services in Asia, commented. “This may include remote working, flexible workspace and a hub-and-spoke model where the tenant retains its CBD headquarters, perhaps with a reduced footprint, coupled with suburban satellite offices.”

The office is expected to play a central role in those choices, with the company’s experts recommending that occupiers promote the centralised workplace as an anchor for collaboration and an enabler of culture and corporate mission. Colliers sees the office as vital for face-to-face functions that support company growth and talent development, such as induction of new employees, learning and knowledge transfer. Colliers therefore believes that that home working will complement rather than supplant office activity.

A Low-Density Future

Looking ahead, Colliers foresees a workplace shift which favours landlords and occupiers who can offer more space for workers as COVID-19 renders untenable a decades-long drive towards higher-density commercial environments.

The company’s experts expect most occupiers to adhere to standard social distancing guidelines now, with a distance of at least 1.5 metres between staff members present in offices. This will require occupiers to make greater use of rotation-based and remote working models, rather than look for larger workplaces.

To help refill buildings safely, the firm recommends that asset owners consider upgrades that will address the workplace health concerns of occupiers and their staff.

“Looking ahead, we expect investors to assign a premium to buildings with very high standards of hygiene and sanitation and wellness certifications,” the report’s authors said. Colliers’ team predicts that governments are likely to impose such standards in many locations, while staff will increasingly demand them.

Discovering the Suburbs

While underlining that the critical mass of commercial activity in the CBD areas of Asia Pacific’s largest cities ensures their ongoing role, Colliers foresees a growing expansion into suburban office locations; for instance, the outlying areas of Bangalore have already established themselves as among the city’s preferred business locations.

Terence Tang

Terence Tang of Colliers International

This shift to the suburbs should also present opportunities for both developers and fund managers to meet growing requirements for office space away from traditional urban cores.

“Investors should consider looking past traditional CBDs to decentralised districts and business parks, with the changing definition of ‘core,’ as well as consider tactical partnerships with flexible operators to attract and retain tenants by extending services and offerings,” said Terence Tang, Colliers’ Managing Director for Capital Markets and Investment Services in Asia.

Flexible Space Plays a New Role

The company, which has a dedicated flexible office advisory team, recently introduced

Colliers Mobility Pass, a smartphone app which allows occupiers to book flexible workspaces on the fly, as it sees more corporate office users making flexible space part of a holistic workplace strategy.

“In the new redefined workplaces, the ease of assembling remote teams and accessing flexible workspace on a demand basis will enable occupiers to configure their operations across locations in a much more dynamic way, boosting the resilience of their businesses overall,” Jonathan Wright, Director for Flexible Workspace Consulting for Asia said.

Jonathan Wright Colliers

Jonathan Wright of Colliers International

Colliers also expects landlords and flexible office providers to follow new thinking, with Tang recommending that asset owners and co-working operators adopt a more versatile approach to offering flexible space for tenants, including setting up new management and leasing structures, rather than holding out for buildings occupied in the traditional way by corporate anchor tenants.

The company, which profiled nine different APAC city office markets in the report, has recently rolled out Work3, a platform of research, advisory and specialized services designed to help occupiers navigate the accelerating changes in today’s new world of work ‘place,’ ‘space,’ and ‘pace’.

With tools such as its new online platform available, and landlords facing new pressures, Colliers recommends that occupiers should be proactively reviewing existing leases to identify opportunities and take advantage of the increase in space options in the market.

This sponsored feature was contributed by Colliers International. All images are courtesy of Colliers International. 

Share this now

  • LinkedIn
  • Share
  • Tweet
  • Email

Filed Under: Sponsored Tagged With: Asia Pacific, Colliers International, office leasing, office market, sponsored

Value-Add Forum

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Get Mingtiandi Delivered

Top Stories

Weave Moves into Multi-Family With Buy in Hong Kong’s Mid-LevelsWeave Moves into Multi-Family With Buy in Hong Kong's Mid-Levels

BlackRock Closes on $1.2B for Asia Property Fund VBlackRock Closes on $1.2B for Asia Property Fund V

CFLD Default on $530M Bond Highlights Developer Risks From China Credit…CFLD Default on $530M Bond Highlights Developer Risks From China Credit Crackdown

Hong Kong’s PAG Completes Buyout of Australian Workplace Design Firm UnispaceHong Kong’s PAG Completes Buyout of Australian Workplace Design Firm Unispace

LV, Fendi Close Shops in Hong Kong’s Times Square and More Asia Real…LV, Fendi Close Shops in Hong Kong’s Times Square and More Asia Real Estate Headlines


People in the News

mark machin CPPIB

Asia Real Estate People in the News 2021-03-01

Hines's managing director, Drew Huffman

Hines Ramps Up APAC Presence With New Hires in Japan, South Korea

Yun Choi Heitman

Skip Schwartz to Head Back to US as Heitman Preps New APAC Leadership

terence lee kkr

Asia Real Estate People in the News 2021-02-22

Hong Kong Developer Chinese Estates Promotes Joseph Lau’s Wife, Chan Hoi-wan, to CEO

Latest Stories

Wang Wenxue CFLD

CFLD Default on $530M Bond Highlights Developer Risks From China Credit Crackdown

Kaisa's Chairman, Kwok Ying Shing

Kaisa Ploy to Keep Control of Nam Tai Thwarted by BVI Court

Xu Jiayin Evergrande

Evergrande Courts HK Tycoons for Electric Car Push and More Asia Real Estate Headlines

weijian shan PAG

Hong Kong’s PAG Completes Buyout of Australian Workplace Design Firm Unispace

Embassy Suites By Hilton Palm Desert

Bank of America Files to Dismiss EHT Bankruptcies and More Asia Real Estate Headlines

Watch for Mingtiandi In

Watch for Mingtiandi

Connect with Mingtiandi

  • Facebook
  • LinkedIn
  • RSS
  • Twitter

Real Estate News

  • Capital Markets
  • Events
    • 2021 Mingtiandi Event Calendar
    • Join the Mingtiandi Asia Value-Add Forum 2021
    • Join the Mingtiandi Multi-Family Investment Forum 2021
    • Join the Mingtiandi Logistics Real Estate Forum 2021
    • Join the Mingtiandi Sustainable Real Estate Forum 2021
    • Join the Mingtiandi Data Centre Forum 2021
    • Join the Mingtiandi Office Strategies Forum 2021
    • Join the Mingtiandi Proptech Forum in November
    • More Events
  • MTD TV
  • People
  • Logistics
  • Asia Outbound
  • Retail
  • Design & Construction
  • Research & Policy
  • Advertise

More Mingtiandi

  • About Mingtiandi
  • Contact Mingtiandi
  • Newsletter Subscription
  • Terms of Use
  • Privacy
  • Advertise
  • Join the Mingtiandi Team