CBD Gets Desperate as Rents Decline by 20-30%

Beijing’s central business district (CBD) has suffered several large-scale departures, and the space rented in office buildings in the city center has declined by as much as 30% in the last year alone.

At 18%, Beijing’s overall office vacancy rate is now the highest out of China’s first-tier cities. According to the China Real Estate Information Corp (CRIC), rent prices fell by 3.7% in the last quarter as a result.

The recent departures of large state-owned enterprises – such as Sinochem Holdings and China Huaneng Group – have left huge gaps in the market. They both moved their headquarters to the Xiongan New Area, which is about 100km southwest of Beijing. 

View of the central business district in Beijing (Image via Ai)

Tech giants have also increased the vacancy rates by moving their offices out of Beijing. Alibaba Holding Group recently left 150,000 square meters of office space empty in Wangjing after it relocated its headquarters to an industrial estate 22.5km outside of the city. 

Samsung Tower in the CBD now has a vacancy rate of 20%, and is offering nine months of rent-free tenancy to draw in new tenants, while other buildings nearby are offering three to four months for free.

Citywide rents are expected to further decline in the second half of 2024 as Beijing’s role as the hub for the headquarters of most state-owned firms changes.

Landlords will have to continue to offer better prices and terms to avoid further vacancies in the coming months.

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[Cover image via ChinaDaily]