TAIPEI, Dec. 20, 2012 /PRNewswire/ -- According to The Executive Centre, Asia Pacific's leading premium serviced office provider, investors and entrepreneurs in Taiwan have been embracing serviced office, making it a well-established mature market segment. It is expected that the demand for workspace will remain steady in a short term but possessing huge potential when witnessing a closer economic bonding with mainland China and a rebounding confidence from businesses.
Static Substantial Office Demand
The workspace in Taipei has always been in demand because of its limited supply. According to a recent Collier report, the net occupancy of Grade-A offices was 6979 ping in 2Q 2012 which drove the vacancy rate down by 1.3 % to 10%, the lowest since 1Q 2009 (Note 1). Collier forecast that the average office rent will remain stable at 2500NTs/ping/month, witnessing possibly a slight growth of 100NTs/ping/month. The serviced office market likewise is in progress of a slow recovery. Jacqueline Lin, Head of Taipei of The Executive Centre commented, "3500 workstations are currently provided Taipei by major serviced office providers at an average from 3000NTs/ping/month to 8000NTs/ping/month. Flexible leasing terms and the prospect of minimising overhead expenses are significant appeals to SMEs and even corporations under the uncertain global economic climate. The Executive Centre's occupancy rate has been as high as 94% and sees no sign of falling."
Drivers of Economy
Being the world's 26th largest economy, Taiwan has built her foothold specialising in the production and export of electronics and machinery. It is one of the world's largest suppliers of computer chips, LCD panels, DRAM computer memory, networking equipment, and consumer electronics (Note 2). Jacqueline continued, "Along with consultancy firm, headhuting firm and pharmaceutical company, information technology group is also The Executive Centre's major source of clients. With trending demand for digital products, we are confident Taiwan's economy will continue to benefit immensely from the IT industry."
A recent report Global Investment Trends Monitor released by the United Nations Conference on Trade and Development (UNCTAD) recorded Taiwan's FDI inflows rose to US$1.8 billion in the first half of 2012, from an outflow of US$1.4 billion over the same period of last year (Note 3). GDP of Taiwan expanded 0.98 percent in the third quarter of 2012 over the previous quarter, seeing a steady recovery over the year. The indices suggest a climbing confidence from investors and businesses (Note 2). In the healing period, serviced office can well find a comfortable position in being an inspiring workspace solution to businesses who are just gaining back on their momentum. At The Executive Centre, office space and layout can be customised to suit the client's specific needs. Individual serviced office suites are sized from one to six workstations, and can be combined into larger workstation grouping of any size, suitable for companies nowadays who are always in need for the fluidity in sizing their projects, especially in terms of their office infrastructure.
Cross-Taiwan Strait Currency Settlement Mechanism
A Memorandum of Understanding (MOU) on Currency Settlement was signed between mainland China and Taiwan in August targeting at setting up a Cross-Taiwan Strait Currency Settlement Mechanism to minimise exchange cost and the transaction risk involved. Under the current system, only offshore banking units (OBUs) of Taiwan banks are eligible to do RMB-denominated business, with the currency transactions settled through an international settlement mechanism. Once the mechanism is established, domestic banking units (DBUs) of Taiwan banks will also be allowed to conduct RMB-denominated business (Note 4).The materialisation of the agreement will be a milestone in the economic relationship between mainland China and Taiwan and can definitely fuel foreign, mainland Chinese as well as local investment in Taiwan. Serviced office can be an optimal comfort zone for entrepreneurs who look for an immediate presence in Taiwan. New set-up companies can reap a professional business environment from The Executive Centre's prestigiously located, well-equipped ready-to-work serviced office.
Market Forecast 2013
Taiwan's serviced office sector is enjoying the stability of a mature market with rental difference of 2-3% per year (up or down). It is anticipated that minimum short-term growth will occur in 2013 as indices show that the market is still recovering. Vacancy rate may drop indebted to occasional leasing transactions from relocation and expansion. However, greater potential is waiting when a closer mainland China-Taiwan economic relation is achieved through Cross-Taiwan Strait Currency Settlement Mechanism.
"The Executive Centre has an extensive network of 50 centres in 18 cities across Asia Pacific. We are well equipped to harvest from the much anticipated boom that the market can provide. As a leading serviced office provider in the region, we have the acute business sensitivity to react to the change of the market and help SMEs and corporations to seize the opportunities to grow," said Paul Salnikow, Chairman and CEO of The Executive Centre.
"The Executive Centre shows no signs of slowing down. Since 2005, our business has grown by 261% compared to an industry average of 73%. Over the past three months, we have launched new premier office facilities in Singapore, Shenzhen, Shanghai, Chengdu, Mumbai, Sydney, Brisbane and Perth. Our expansion plans at prime CBD locations across the region are also ongoing. Leveraging the rising demand for premium serviced office space driven by companies seeking the advantages of flexible workspace solutions, we are confident of the growth at The Executive Centre in the coming years both in terms of capacity and revenue," Paul Salnikow continued.
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About The Executive Centre
The Executive Centre is the leading premium serviced office provider in Asia Pacific with 50 offices in 18 cities. Founded in 1994, it operates in Hong Kong, Beijing, Chengdu, Guangzhou, Shanghai, Shenzhen, Tianjin, Macau, Gurgaon, Mumbai, Jakarta, Tokyo, Seoul, Singapore, Taipei, Brisbane, Perth and Sydney. The Executive Centre provides serviced offices, virtual office representation services, meeting and conference facilities, and business concierge services to multinational corporations, small and medium enterprises, and start-ups locally, regionally and internationally. Please visit our Web site at www.executivecentre.com
CONTACT:
Gigi Liu
Communications Director
The Executive Centre
T: (852) 2297 2483
E: gigi_liu@executivecentre.com
