Seoul Office Vacancy Rate for Spaces Over 10,000 Pyeong Hits Lowest in 10 Years

[Asia Economy Reporter Onyu Lim] The vacancy rate of Grade A offices (with a total floor area of over 10,000 pyeong) in Seoul has recently recorded the lowest level in the past 10 years.

According to the office market trend report by Jones Lang LaSalle (JLL) on the 6th, the vacancy rate of Seoul Grade A offices in the fourth quarter of last year was 7.7%. This is the lowest since the third quarter of 2010, decreasing by 1.9 percentage points compared to the previous quarter.

Specifically, the vacancy rate in the downtown area fell the most, dropping 4.94 percentage points from the previous quarter to 10%. It is the first time in over five years since the third quarter of 2014 that the downtown vacancy rate has fallen below 10%.

The vacancy rate of Grade A offices in the Yeouido area recorded 9.5%, down 0.6 percentage points from the previous quarter. This is the lowest since 2012. The demand for leases was driven by numerous small- and medium-sized lease contracts signed by IFC (International Finance Center Seoul) and FKI (Federation of Korean Industries Tower).

The Gangnam area was the only district where the vacancy rate increased compared to other areas. It rose 0.96 percentage points from the previous quarter to 3.9%. JLL stated, “Although the vacancy rate slightly increased, it still remains below the natural vacancy rate,” adding, “It is difficult to find buildings in the Gangnam area with vacancy rates exceeding 20%.”

Shim Hyewon, head of JLL’s research team, said, “Despite the economic slowdown last year, the Grade A office market recorded single-digit vacancy rates in all three major districts due to strong lease demand in the downtown and Gangnam areas,” and predicted, “This year, with the unprecedented level of new supply flooding the market, an increase in vacancy rates is inevitable.”

This content was produced with the assistance of AI translation services.