Shenzhen office leasing in core districts is picking up as technology firms seek premium space, even as analysts say oversupply will keep vacancies high in the near term [1]. James Macdonald, head of research for China at Savills, said, "While tech demand is growing, it is still insufficient to rebalance the market in the short term," adding that "that limits their ability to offset broader pressures." [1]
The technology sector, including AI, consumer electronics and robotics, is driving demand in western submarkets such as Nanshan and Bao’an [1]. Lulu Shi, director of Asia-Pacific corporate ratings at Fitch Ratings, said, "As AI develops rapidly and technology companies emerge, expand and upgrade, they are increasingly seeking higher-quality office space in core business districts and innovation hubs," and said this is "supporting absorption, particularly in grade A buildings." [1]
Tech-related occupiers still made up less than 30% of total leasing demand, according to Savills [1]. In the first quarter, major technology firms signed leases totalling around 25,000 square metres, while robotics companies took up roughly 20,000 square metres of industrial space, according to JLL [1].
By the end of the first quarter, Shenzhen's grade A office vacancy rate edged down 0.5 percentage points to 25.9% [1]. Even so, about 2.26 million square metres of new office space is expected to be completed in Shenzhen this year, which would lift total stock by nearly 18% [1]. Macdonald said the market still faces pressure from supply, and the new demand is not yet enough to change that picture [1].
More office completions are due in 2026, and the added supply is expected to keep vacancy rates under pressure as the year unfolds [1].
