UNEVEN RECOVERY ACROSS THE REGION

As we enter our third pandemic year, it is clear that in the field of real estate retailing, hospitality and tourism have been hit hardest by government measures which have included travel bans, social distancing and lockdowns.

Though this has led to a period of general upheaval for the retail property market, the severity of infection rates, the varied success of vaccination programs and diverse containment strategies have all meant that recovery rates have been far from consistent across the region.

The leading group includes mostly Chinese and Vietnamese cities, where business activity levels have remained robust with periodic disruptions. Beijing (3.4%), Shanghai (13.1%), Guangzhou (10.5%), Hanoi (4.3%) and Ho Chi Minh City (0.4%) have seen modest growth in rents over the past two years. Meanwhile, the laggards which include Singapore (-28.4%), Hong Kong (-26.3%), Seoul (-19.5%), and Tokyo (-16.1%) have moved beyond their lows with improving sentiment in evidence since the second half of 2021.

Domestic consumption has lent support to these markets, particularly suburban/community retail, while rental growth among prime retail properties has remained weak.

In markets which recorded growth, demand was driven by consumption from both residents and domestic visitors.