Office leasing demand remained weak in Q3 2019 due to continued slow global economic growth and the ongoing U.S.-China trade conflict. The large volume of new supply, slow pre-leasing and lack of new sources of demand ensured rents declined by 0.2% q-o-q.
Regional retail leasing activity weakened as most retailers remained cautious towards expansion and adopted a highly selective attitude towards location. Rents fell by 1.7% q-o-q, mostly due to the sharp 10.5% fall in Hong Kong which continues to see large demonstrations in major retail areas.
Industrial sentiment weakened further this quarter alongside the deteriorating economic outlook. Regional rental growth slowed to 0.3% q-o-q, the smallest gain in almost two years, as landlords turned more flexible towards lease terms.
Commercial real estate transaction volume registered US$34 billion in Q3 2019, an increase of 17% q-o-q, supported by the completion of several large and related-party transactions.