Bangkok--Jan 18--CB Richard Ellis (Thailand)
Activity in the fourth quarter was up almost across-the-board in the main industrial, hi-tech and logistical centres of Asia, according to the latest survey produced by international property consultants CB Richard Ellis.
The industrial market in Thailand remained active within the fourth quarter, reflecting the country’s general fast pace of economic growth. Various industrial sectors are expected to witness expansionary growth over the next few years. Indeed, a number of firms, and most notably Japanese multinationals, are expected to expand in or relocate to Thailand. Market activity will continue to be concentrated in the best quality industrial estates in areas such as Rayong, Chonburi and Ayutthaya, all of which are currently expanding.
In the Philippines the industrial property market continued to pick up in the fourth quarter, propelled mainly by the expansionary initiatives of Business Process Outsourcings (BPOs) and call centres, as well as by new and additional investment in manufacturing and in logistics services. Outsourcing has emerged as a major support not only to the Metro Manila office sector but also to industrial parks, economic zones and IT parks in major provincial locations.
Industrial land values in Ho Chi Minh City continued to increase in the fourth quarter, especially those alongside the Hanoi Highway and 13th Highway. The fact that much site clearance involves resettlement is becoming a major obstacle to increasing industrial land supply which, in turn, is driving up land values in existing industrial estates.
In China, Beijing was most affected by controls implemented on land-use as there were no new industrial completions in Beijing within the fourth quarter. Except for a small number of land parcels repossessed by the management of industrial parks, essentially no vacant sites are available in any major industrial district in Beijing. However, the leasing of manufacturing facilities and factory space in the capital’s major districts was active in the fourth quarter.
Meanwhile, the industrial market in Shanghai remained quite active during the fourth quarter of 2004. Numerous registered Wholly Owned Foreign Enterprises capitalised on China’s continued progressive implementation of market opening measures by expanding their operations in the city, generating more demand for land.
The motor industry, whilst having a secondary effect on the Shanghai market, directly impacted on the demand for industrial space in Guangzhou, which saw upward pressure in the fourth quarter of 2004, stimulated by a sharp rise in requirements by the car manufacturing and auto-related sectors. Toyota, Nissan and Honda have all established assembly lines in the city with sales offices and supply chains set up in various parts of the city. The agglomeration effect brought about by these Japanese car industries has led to the emergence of a sizeable Japanese car-manufacturing centre in Guangzhou.
In Hong Kong, the industrial property market witnessed strong performance in the fourth quarter of 2004. Leasing activity was robust on the back of the continuing surge in re-exports and air-cargo throughput, benefiting from strong global demand for goods manufactured in China. At the same time, the industrial sales market regained momentum in the fourth quarter on the back of increased demand from both investors and end-users.
Meanwhile, the decline in manufacturing in Japan has resulted in a waning demand for smaller buildings, while the growth in logistics has created strong demand for large, efficient and well-located facilities. Strong demand from end-users is creating a highly competitive environment for the handful of existing logistics facilities. Since 2002 there has been a marked up-tick in the supply of industrial space providing floor area of over 10,000 sq.m., with 2.6 million sq.m. of such facilities having come on stream in 2004 alone.
Singapore experienced slower leasing demand for industrial space while rentals remained flat. Greater activity was, however, seen in the investment sales segment as institutional purchasers continued to add properties to their portfolios. There is currently a contradiction between positive macroeconomic figures in the country and a slow leasing market, which indicates that industrialists are focusing more on productivity rather than space expansion.
In Bangalore, construction work is going on everywhere around Electronics City, fuelled by the booming BPO sector. However, the rapid rise in land prices is forcing some firms to think about relocating or establishing their initial operations in other regions of India. Meanwhile, in Mumbai, industrial property for manufacturing is now only being developed in pockets of Navi Mumbai, Thane and in nearby areas like Pune, Nashik and Daman. Investors have shown little interest in acquiring industrial property in inner Mumbai, except for undertaking demolition and urban redevelopment.
About CB Richard Ellis
Headquarter in Los Angeles, CB Richard Ellis is a leading global real estate services firm. With more than 17,000* employees, the company serves real estate owners, investors and occupiers throughout 300 principal offices worldwide. The company’s core services include property sales, leasing and management; corporate services; facilities and project management; mortgage banking; investment management; capital markets; appraisal and valuation; research and consulting. CB Richard Ellis is a public company, listed on the New York Stock Exchange under the symbol CBG.
CB Richard Ellis established an office in Bangkok in 1988 and in Phuket in 2004. CB Richard Ellis (Thailand) Co., Ltd. has grown to be a leading real estate services provider, offering a full range of services including sales and leasing for all types of property, property and facilities management, valuation and advisory, and research and consulting. For more information, visit the company's website at www.cbre.co.th.
* Includes partner offices
FOR IMMEDIATE RELEASE พ 17 January 2005
For further information:
Mr. James PitchonExecutive Director 02 654 1111
Mr. Daniel McDonaldManaging Director - Shanghai+86 10 6539 1288
Ms. Ngamjai Jearrajarat Corporate Communications Manager
02 654 1111 Ext. 522 End.