Bangkok office rentals increase 2.1 per cent in Q2

The Bangkok office market showed strong demand in the first half of the year with a 2.1-per-cent increase in overall rentals in the second quarter, according to research by Knight Frank Thailand.

In the second quarter, there was about 4,555,271 square metres of office space in Bangkok. The occupancy rate increased to 91 per cent from 90.6 per cent in the first quarter. The occupied space was around 4,144,149.45sqm, with only 411,121.89sqm available in the market.

The occupancy rates increased in every segment except the Grade A non-CBD (central business district) category, which dropped to 81.4 per cent in the second quarter year, from 94.7 per cent in the first quarter. The highest occupancy rate was in the Grade A CBD category, at about 93.2 per cent, followed by the Grade B CBD and Grade B non-CBD segments, at 91.3 per cent and 89.3 per cent respectively.

The overall average rental rate was Bt630 per square metre, representing an increase of 2.1 per cent from just Bt617 per square metre in the third quarter of last year. The average rental rate increased in all segments, and the highest rental rate was shown in the Grade A CBD segment, which commanded about Bt823 per square metre; this represented a 1.9-per-cent year-on-year increase from Bt808 per square metre in the third quarter of 2013. 

The average rental rate of Grade B CBD space was Bt599 per square metre, increasing 1.5 per cent. 

The highest increase of average rental rates was in Grade A non-CBD space, up by 3.1 per cent from just Bt625 in the third quarter of last year to Bt644 in the second quarter of this year. 

The lowest average rental rate was in the Grade B non-CBD category at Bt453 per square metre, increasing 2.1 per cent. 

 

Park Venture 

The highest asking rate was at Park Venture, which commanded Bt1,100 per square metre during the second quarter, followed by Exchange Tower at Bt1,000 per square metre.

Marcus Burtenshaw, executive director and head of commercial agency, Knight Frank Chartered (Thailand) Co, said it was interesting to see that the upward adjustment of office rents in Bangkok had been lower than the change in the inflation rate. 

This was due to various factors, such as the global economic climate and political instability in Thailand, which dampened demand. 

But as stability returns the firm expects office rents to increase, as demand could exceed the limited new supply.