The central business district in Beijing is experiencing a significant decline in office rents, with rates dropping by 20 to 30 per cent due to economic challenges, the departure of foreign-owned businesses, and overall business struggles. Landlords are offering discounts and rent-free periods to retain tenants in the face of rising vacancy rates, caused in part by major corporations moving their headquarters to the Xiongan New Area.
As vacancy rates rise, competition among landlords intensifies, leading to lower rents and more attractive leasing terms. With the relocation of state-owned enterprises and tech firms out of the city, Beijing’s property market dynamics are evolving, requiring consideration of both economic and political factors. Despite some improvements in leasing activity, the uncertain economic outlook suggests that rents will continue to decline in the near future, fostering a citywide price war among different office market segments.