With the rising of storage land use in Tianjin, the pallet racking will be the next hot point.
Jones Lang LaSalle recently published a report about Tianjin real estate market of the fourth quarter in 2013, the report showed that the net absorption of office market in Tianjin fourth quarter of 2013 has declined, and the third industry become the main requirements sources; the overall stock of the storage land use is rising. The shopping center market stock is increasing, and then the high-end housing market will be back confidently.The additional supply of industrial logistics improved the overall storage quality.
The overall stock of the storage land use is rising. The completion of two new warehouses in fourth quarter of 2013 raised the overall stock to 120000 square meters. In 2013, there are 5 warehouses been completed, two of them are located in existing traditional industry area: Binhai New Area and Beichen District. The other three warehouses are in WQX, benefited from the distance to the center of Tianjin and Beijing, WQX become an important logistics section step by step. Jason Wang, the Tianjin Industrial Logistics Director of Jones Lang LaSalle Office said that, “What the warehouse tenants looking for is the district which can service for Beijing and Tianjin at the same time, especially in the condition that the warehouse land supply is reducing in Beijing. In some districts of north Tianjin, the developers are now building new warehouse for their clients, so their clients can service for other cities in the district. In the years ahead, the WQX, and other rising logistics center will be the main descendents of the additional supplies”.
The lease demand is continued active in the forth quarter of 2013. However, the additional supply can’t meet the demanding, which made the overall vacancy rate raised from 18.8% in last quarter to 22.9% in this quarter. In 2013, The overall market net absorption is still relatively slow, even markedly dropped compared to the past three years thought many e-commerce and business companies move to Tianjin for the occupancy rate is too high in Beijing. The main reason for the limiting of the demand is that the development of the manufacturing and heavy industries are uncertain in 2013, and these industries are the main motivator of Tianjin market.
The rising speed of the overall rent is slowing up. The overall gross rent is remained at 1 yuan per square metre per day. This is caused by the dropped of the demand and the additional supply. At the same time, more supplies will appear in the city’s new industrial logistics zone, and these supplies all charging more lower rent, these are all the obstacles of the rent increases.
The additional supplies lowered the rent increases. 7 or more projects will enter the market in 2014; a new round of supply will continue putting pressure on rental growth, at the same time, the additional supplies in the year ahead will continue putting pressure on rental growth, which will keep the rent on an optimistic level, and the pallet racking needs will also in a high level without dropping.
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