Cushman & Wakefield today released its Optimal Prime — Grade A Office Optimisation on the Chinese Mainland report. To keep abreast of the changing environment, Cushman & Wakefield conducted a 20-question questionnaire survey on Grade A office landlords on the Chinese mainland. The questions focused on their perspectives and the answers provide the reader with the latest thinking prime office landlords in the region have on the market conditions and have on their current and future office asset management strategy to achieve commercial success.
A Change is Needed
Given market conditions, the majority of Grade A office landlords on the Chinese mainland currently feel a change is needed in their office building asset management strategy. In terms of their leasing strategy, most office landlords will focus on refining their tenant profile mix. Within this mix, the ratio of domestic companies is expected to continue to expand in the near future, with professional services, finance and TMT being the industries to lead the mix in terms of occupied space.
Asset Management
Refinement in both hard and soft asset management services will play a large role in driving Chinese mainland Grade A office asset management strategy change. Facilities within prime office buildings in the region will also to be targeted for change with most landlords advancing improvement in the tenant-focused amenities that they provide. Assigning more portfolio space to amenities will undoubtedly allow a prime office building on the Chinese mainland to remain market competitive.
Sustainability
Improvement in Grade A office green offerings, features and credentials will continue on the Chinese mainland and this change will be driven by a greater number of landlords now being aware of the concept of ESG and the fact that many more of their tenants have ESG reporting goals to meet.
Landlords in the region are looking at a number of ways to achieve improvement, including gaining more green certifications, assigning more wellness and wellbeing space for their tenants and installing more energy and water saving equipment.
Optimal Prime
When looking at whether to adopt an asset-light asset management business model or not, there is currently a 50-50 split between those Grade A office landlords on the Chinese mainland that looking to adopt and those that are not.
With cost being a top priority for Grade A office landlords on the Chinese mainland and these same landlords desiring an optimal prime solution, we expect an asset-light asset management business model to be adopted by more landlords in the region in the future.
Jonathan Wei, President, Project & Occupier Services, China, said, “When market conditions are more tenant-favorable, a proactive line of thinking related to an improvement in office building asset management becomes vital to ensure market relevance and make certain market competitiveness.”
Shaun Brodie, Head of Research Content, Greater China, said, “Fine-tuning in both hard and soft asset management services will go a long way in driving Chinese mainland Grade A office asset management strategy change. Many more of the tenants have ESG reporting targets to attain and a greater number of landlords now are conscious of the conception of ESG.”
Please click here to download the full report.
About Cushman & Wakefield
Cushman & Wakefield (NYSE: CWK) is a leading global commercial real estate services firm for property owners and occupiers with approximately 52,000 employees in nearly 400 offices and 60 countries. In 2023, the firm reported revenue of $9.5 billion across its core services of property, facilities and project management, leasing, capital markets, and valuation and other services. It also receives numerous industry and business accolades for its award-winning culture and commitment to Diversity, Equity and Inclusion (DEI), sustainability and more. For additional information, visit www.cushmanwakefield.com.
