Corporate confidence is boosting activity in top tier office markets around the world, leading to accelerating early cycle rental growth and robust capital value growth in prime assets, especially where new quality supply is limited, according to Jones Lang LaSalle's inaugural, quarterly Global Office Outlook report. The report points to several hot spots emerging with high growth prospects. Poland is one of those and the only European market with such an excellent evaluation.
The remaining countries classified as high growth regions include E7 (Brazil, India, China, Russia, Indonesia, Mexico and Turkey), Hong Kong and Singapore.
For the first time since the global financial crisis, downside risks are being outweighed by the improving business optimism although recent global events have the capacity to dent this optimism.
Jones Lang LaSalle's Global Office Outlook report shows that market demand and leasing activity are back in a cyclical upswing, fueled by improving economic growth, renewed corporate confidence, and strengthened balance sheets and prospects of increasing spending and hiring associated with real estate investment.
Global office vacancy rates have reached a plateau and edged downward across all three regions in late 2010. The global office vacancy rate now stands at 14.1%.
Prior to the Japan earthquake and tsunami, Asia Pacific was moving ahead strongly with the largest declines in vacancy, improving occupancy levels, and attractive conditions for investment.
Jane Murray, Asia Pacific Head of Research, added: "Regional momentum should continue led by robust growth in China and India. The ultimate impact on the large Japanese economy and real estate market and its trading partners regionally and globally will not be known for some time."
Source: Jones Lang LaSalle