Western financial firms still want a piece of Shanghai’s office market

The Chinese government eased restrictions on foreign firms this year

New York Weekend Edition /
May.May 02, 2020 02:00 PM
Shanghai, China (Credit: Pixabay)

Shanghai, China (Credit: Pixabay)

Shanghai’s office market stands to benefit from strong appetite from foreign financial firms.

Financial institutions from around the globe moved to grab office spaces and expand their operations when the Chinese government announced last year it would ease restrictions on foreign involvement in the country’s financial system. Many are staying the course, according to Bloomberg.

“Foreign financial tenants are undeterred by the outbreak. We haven’t really seen anyone winding back expansion plans like some other multinational companies,” said CBRE’s Fion Zhang.

They’ve scooped up prime office spaces. Bank of America expanded its footprint by 20 percent when it moved into the International Finance Center in the fourth quarter.

Japanese brokerage Nomura Holdings has nearly doubled its footprint in anticipation of doubling its headcount in Shanghai by 2023. The influx of large foreign entities has helped bring in smaller firms too. Swiss firm EFG Bank AG for example signed a 120-square-meter lease late last year.

Strong demand is a relief for Shanghai developers and landlords. Among other things, a supply glut and China’s trade war with the United States last year pushed office vacancy rates to levels not seen since the last financial crisis.

Vacancy rates in Shanghai are expected to hit 30 percent this year and rents to drop 6 percent, according to Colliers International. [Bloomberg]Dennis Lynch


Related Articles

arrow_forward_ios
Equitable CEO Mark Pearson and Fisher Brothers’ CEO Ken Fisher with 1345 Avenue of the Americas (Google Maps)
Equitable Life Insurance inks 130K sf lease for new office
Equitable Life Insurance inks 130K sf lease for new office
Vornado's Steven Roth and One Park Avenue (Photos via Getty, Vornado)
Vornado to get $525M to refi One Park Avenue
Vornado to get $525M to refi One Park Avenue
Chairman Edmund Cheng (Photos via Esplanade; Unsplash)
Mapletree Investments bets big on European office market
Mapletree Investments bets big on European office market
Tishman Speyer CEO Rob Speyer and renderings of Foundry  I. (Getty, Cielo)
Tishman Speyer jumps on Austin bandwagon with $150M deal
Tishman Speyer jumps on Austin bandwagon with $150M deal
Industrious CEO Jamie Hodari (right). Inset (clockwise): TF Cornerstone’s Frederick Elghanayan, Vornado’s Steven Roth, LIVWRK’s Asher Abehsera, Thor Equities’ Joseph Sitt, and George Comfort & Sons’ Peter Duncan (Photo Illustration by Kevin Rebong for The Real Deal)
As flex-office space contracts, Industrious grows NYC footprint
As flex-office space contracts, Industrious grows NYC footprint
1345 Sixth Avenue, 11 Madison Avenue top the list of January deals. (Sapir, WikiMedia)
Manhattan office availability hits record-high 14.9%
Manhattan office availability hits record-high 14.9%
ART: Knotel CEO Amol Sarva and Newmark CEO Barry Gosin (Sarva via Sasha Maslov; Gosin via Newmark)
Knotel files for bankruptcy, set to be bought by Newmark
Knotel files for bankruptcy, set to be bought by Newmark
(iStock/Illustration by Alexis Manrodt for The Real Deal)
AmEx to employees: Don’t leave home…until Labor Day
AmEx to employees: Don’t leave home…until Labor Day
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...