Office occupiers in Taipei tend to be overly cautious and slow in evaluating their leasing options. Many enterprises are not aware of the importance of having a lease renewal strategy and may only start negotiations with landlords as little as six months before their lease expires. Recent years have seen several cases of occupiers failing to identify and secure suitable premises for relocation due to their having left it too late, thereby losing significant leverage in negotiations with their current landlords.
While the lack of a dedicated corporate real estate team partly accounts for the fact that many companies in Taiwan do not have an overall corporate real estate leasing strategy, a lack of understanding about the vacancy rate in the Taipei office market is also responsible for occupiers’ frequently underestimating the time required to search for new offices. Many tenants believe that significant new supply is about to come on stream, and therefore act slowly in assessing their space requirements, leaving insufficient time to evaluate options.
This report by CBRE Research analyses office demand and supply trends in Taipei; explains why vacancy rates are misleading; and examines the office development pipeline for the next five to ten years. By doing so, CBRE Research aims to help occupiers, especially large enterprises, make relocation decisions that are beneficial to their business growth and financial performance. The report also provides recommendations to landlords of older office buildings as to how they can compete with newer properties and improve the landlord-tenant relationship.