2021: LEASING DEMAND REBOUNDED WITH STRONG ECONOMIC RECOVERY

The gradual resumption of work and production after the initial epidemic in 2020 brought a significant recovery to Guangzhou’s economy in 2021, growing by 8.1% YoY and up 1.3 ppts from the pre-COVID level (2019), thereby outperforming many cities across China and ranking second among the first-tier cities. Consequently, the office leasing demand also rebounded significantly with tenants from several TMT giants, retail and trade companies, law firms and financial institutions taking up sizable office spaces in both core and emerging submarkets. This led to an increase in the annual net take-up of 460,528 sq m, reaching a four-year high and 8.7 times higher than that of 2020. It also surpassed the pre-COVID level net-take up by 1.1 times.

2022: COVID RECURRENCES AND GLOBAL UNCERTAINTIES HALTED LEASING MARKET RECOVERY

Guangzhou’s path to full recovery was challenged by COVID resurgences in many major cities in China since the beginning of 2022, with its GDP growth rate slashing to 2.3% YoY in Q3/2022. This, along with the growing uncertainties brought by the current global macroeconomic environment weighed heavily on the local office leasing market. Many companies had their business operations affected by COVID disruptions, not to mention the rising  inflation. As they turned more prudent toward expanding their businesses, they also became cautious in reviewing their corporate real estate strategies and capital expenditures (CapEx).