2026-02-05-莱坊-Shanghai_Office_Market_Report_Q4_2025_6页_3mb

Shanghai Grade-A Office Market Report Summary (Q4 2025)

Core Content

The Shanghai Grade-A office market experienced continued downward pressure on rents and a slight increase in vacancy rates during Q4 2025. The market is undergoing an adjustment period due to a combination of weak demand and new supply entering the market.

Market Overview

• Rental Decline: Overall Grade-A office rents fell by 3.2% QoQ to RMB6.05 per sqm per day.
• Vacancy Rate: The vacancy rate increased slightly to 23.8% due to new supply and weak demand.
• Net Absorption: Market net absorption reached 82,570 sqm in Q4, indicating some level of demand despite the challenges.
• New Supply: Two new projects totaling 216,585 sqm were delivered, with Crystal Hongqiao (160,000 sqm) and FC Jinmao Plaza (56,585 sqm) being the key contributors.
• Leasing Activity: Nearly 80% of Q4 leasing transactions were from lease renewals and relocations, with a notable increase in cross-district relocations.

Key Drivers of Leasing Demand

• Financial Institutions and TMT Enterprises: These sectors were the main drivers of leasing activity, contributing nearly 45% of the total market share.
• Professional Services and Retail Brands: These sectors accounted for over 20% of leasing transactions.
• Co-Working Operators: Their market share increased, contributing 7% of the leasing transactions in Q4.

Rent Trends by Submarket

• Core CBDs: Nanjing West Road and Huaihai Middle Road showed the smallest rent declines, at 1.3% and 0.9% respectively, to RMB9.48 and RMB7.41 per sqm per day.
• Emerging Submarkets: These areas faced more significant rent declines, with an average drop of 2.3% to RMB5.14 per sqm per day.
• CBD Extension Areas: Experienced a sharper decline of 3.4% to RMB4.62 per sqm per day.

Major Leasing Transactions

Investment Market

• Transaction Volume: In Q4, the market recorded 14 major bulk transactions totaling over RMB6 billion.
• Annual Transactions: The full year of 2025 saw 39 transactions with a total turnover exceeding RMB30 billion.
• Owner-Occupier Demand: This demand has driven asset revitalisation, with buyers targeting properties in a value depression.
• Major Transactions:
  • Fosun Industrial Park (Xuhui): Purchased by Zhonghui Life through an equity transaction.
  • Crystal Hongqiao T6 (Changning): Acquired by Lalamove through an asset transaction.
  • Global Plaza Tower A (1-4F) (Pudong): Purchased by China Cinda Asset Management, Shaanxi Culture Industry Investment Holding, and Zhouzhi County Jinzhou State-owned Capital Investment and Operation (Group) through an asset transaction.

Policy Outlook

The Central Economic Work Conference in December set the tone for economic development, emphasizing domestic demand expansion, technological innovation, and industrial upgrading. These policies are expected to mitigate deflationary pressures and bring moderate recovery opportunities to the office market.

Future Outlook

• New Supply: Nearly 1.4 million sqm of new office space is expected to enter the market in 2026, continuing to exert pressure on the leasing market.
• Rent Trends: Rents are expected to continue declining in Q1 2026, with vacancy rates likely to increase slightly.
• Sector Growth: Enterprises in AI-enabled technology, dual carbon goals, and high-end manufacturing are expected to maintain robust growth, driving leasing demand.

Key Information

• The market is adjusting due to dual pressures from supply and demand.
• Cross-district relocations are increasing, driven by cost control and location requirements.
• Owner-occupier demand is a key factor in asset revitalisation.
• Policy guidance from the 15th Five-Year Plan is expected to support market recovery.
• Financial and TMT sectors remain the main lease demand generators.
• Co-working operators are gaining market share.
• Emerging submarkets and CBD extensions are facing more significant rent declines.

Main Viewpoints

• The Shanghai Grade-A office market is undergoing a period of adjustment.
• New supply is a major factor in the decline of rents and increase in vacancy rates.
• Leasing demand is diversified, with financial and TMT sectors leading the way.
• Co-working operators are becoming more prominent in the market.
• Owner-occupier demand is driving investment activity.
• Policy support is expected to aid market recovery in the coming years.