Seoul Grade A office rents hit record highs

Rents reached KRW100,400 per pyeong in the final quarter of 2021.

Average monthly rent for Seoul Grade A office hit a record KRW 100,400 per pyeong in Q4 2021. According to JLL, iIt is the first time that the net effective rent in Seoul has exceeded KRW 100,000. It rose very steeply by 2.8% q-o-q and 7.2% y-o-y. 

There are buildings with price adjustments in advance for 2022, and the vacancy rate stabilised below 10%. Rent-free periods also dropped sharply from 3.0 last quarter to 2.8 this quarter, which will have a positive effect. 

Here’s more from JLL:

By district, net effective rent in CBD was found to be about KRW 98,900 per pyeong, up 0.3% from last quarter. The rent in CBD continues to maintain a similar level compared to other districts this year. 

In Yeouido, net effective rent was about KRW 83,400 per pyeong, up 5.4% q-o-q and 12.7% y-o-y, the steepest increase among the three districts. Buildings with stabilised vacancy rates, such as FKI Tower and IFC significantly reduced their rent-free periods and increased rents.

Monthly rents in Gangnam rose 3.7% q-o-q to KRW 113,600 per pyeong, the first of the three districts to exceed KRW 110,000 per pyeong. Gangnam's rent-free period this quarter is at 1.3, the lowest level since 2014, reflecting the current situation in the districts which have very few vacancies.