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HONG KONG, July 28, 2015 /PRNewswire/ -- RICS (Royal Institution of Chartered Surveyors) recently published the Q2 2015 Global Commercial Property Monitor. The Occupier Sentiment Index (OSI) has recovered slightly, rising from -7 to -3 in the second quarter. However, the retail market remains weak as demand for space continues to be sluggish. The headline rental expectations will remain flat in the coming three months, with the retail sector being expected to post strong declines.
The Investment Sentiment Index (ISI) recorded a net balance of +1, indicating broadly flat market conditions. According to the monitor, the new curbs on tourist arrivals from China and a slower Chinese economy suggest that spending by Chinese visitors will not likely pick up anytime soon. As a result, the retail sector in Hong Kong will remain under pressure.
RICS Senior Economist Andy Wu, said: Mirroring the survey results from previous quarters, the office and industrial sectors have continued to lead the way with the retail sector lagging significantly behind. Indeed, the retail segment has been the biggest drag on the aggregate sector growth picture. It is notable that the retail space continued to see weak retail sales and a dip in tourist arrivals during the second quarter. As a result, the market for retail space remains in slow motion. Further, our lead indicators do signal that the deterioration in investment potential and weak capital growth expectations will likely continue for a while to come. The retail property market is currently facing a multitude of tough challenges including a decline in Chinese tourist flows into the city and household caution that will continue to weigh on retail spending and expectations for retail property. We believe that without strong support from the tourism sector and a significant rise in consumer confidence, retailers in the local scene will face greater constraints going forward.
The Global Commercial Property Monitor data is a good lead indicator of hard data. This has been the case in many key markets in which RICS has been able to explore the relationship between the RICS time series and other sources of data.
Notes to Editors:
RICS Occupier Sentiment Index (OSI): OSI is constructed by taking an unweighted average of readings for three series relating to the occupier market measured on a net balance basis; occupier demand, the level of inducements and rent expectations.
RICS Investment Sentiment Index (ISI): ISI is constructed by taking an unweighted average of readings for three series relating to the investment market measured on a net balance basis; investment enquiries, capital value expectations and the supply of distressed properties.
Net Balances: Net balance percents, or scores, are calculated by subtracting the numbers of respondents reporting 'down' from the number who reported 'up'.
About RICS
Confidence through Professional Standards
RICS promotes and enforces the highest professional qualifications and standards in the development and management of land, real estate, construction and infrastructure. Our name promises the consistent delivery of standards -- bringing confidence to the markets we serve.
We accredit 118,000 professionals and any individual or firm registered with RICS is subject to our quality assurance. Their expertise covers property, asset valuation, real estate management; the development of infrastructure; and the management of natural resources, such as mining, farms and woodland. From environmental assessments and building controls to negotiating land rights in an emerging economy; if our members are involved the same professional standards and ethics apply.
We believe that standards underpin effective markets. With up to seventy per cent of the world's wealth bound up in land and real estate, our sector is vital to economic development, helping to support stable, sustainable investment and growth around the globe.
With offices covering the major political and financial centres of the world, our market presence means we are ideally placed to influence policy and embed professional standards. We work at a cross-governmental level, delivering international standards that will support a safe and vibrant marketplace in land, real estate, construction and infrastructure, for the benefit of all.
We are proud of our reputation and work hard to protect it, so clients who work with an RICS professional can have confidence in the quality and ethics of the services they receive.
About RICS Asia
RICS Asia supports a network of over 20,000 individual professionals across the Asia region with an objective to help develop the land, property and construction markets in these countries, by introducing professional standards, best practice education and training. We promote RICS and our members as the natural advisors on all property matters. We also ensure that services and career development opportunities are provided to members.
RICS Asia region serves local member associations locating in Brunei, Japan, Malaysia, Singapore, Thailand, The People's Republic of China, Hong Kong SAR, Taiwan and South Korea. It also has members working across the region such as Bangladesh, Bhutan, Burma/Myanmar, Cambodia, Indonesia, Kiribati, Laos PDR, Macao SAR, Mongolia, Nepal, North Korea, The Maldives, The Philippines, Timor East and Vietnam. For more information, please visit: www.ricsasia.org.
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