Colliers: Guangzhou’s serviced apartment market continues slow growth

KUALA LUMPUR: The serviced apartment market continues its positive albeit slow growth in Guangzhou for the third quarter of 2009, states Colliers International 3Q2009 report on Guangzhou’s Serviced Apartment Market. Also, occupancy is at 100%, thanks to the increasing number of embassy workers and their families settling in the city.

The report says there are no new serviced apartment launches in the third quarter although take up has moved slightly upward, causing the overall vacancy rate to experience a minimal drop to 19.1%, down 0.7% q-o-q. The average rents have remained the same at RMB155 (RM77.6) psf/month from 2Q to 3Q2009.

The report also says that the effect of the global economic slowdown has many foreign companies wary of domestic expansion plans. Consequently, the number of expatriates entering Guangzhou will continue to fall in the short term, with the demand for serviced apartments to develop slowly.

Rents should hold steady in 4Q2009. Several serviced apartments are to be completed, such as the West Tower Service Apartment, W Hotel Serviced Apartments, Oakwood International Apartment and Shama Serviced Apartments.

Moreover, serviced apartments with comprehensive facilities and good management are expected to dominate in the future. Collier International believes that even though the economic slowdown has hindered foreign companies’ plans, the number of expatriates entering Guangzhou will increase in the long term as the economy gradually stabilises and government supports the development of the financial service industry.

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