What to expect from the Taipei office market moving forward

Premium office rents are expected to further increase.

Influenced by newly completed office buildings, the rental levels in Taipei may further increase in premium assets, according to a JLL report. However, excess supply coupled with cautious tenant attitudes could lead to slower absorption, potentially creating divergent performance across building classes.

“As a result, occupiers benefit from expanded selection and strengthened negotiating positions during lease discussions. Conversely, landlords face pressure to implement flexible leasing structures to secure quality tenants and maintain income stability,” the report added.

Here’s more from JLL:

The office market experienced a downturn in Q2 2025, with lease volume reaching only 7,000 gross pings, marking 47% of decline as tenants shelve or suspend their relocation plans amid economic uncertainties.

About 48% of office transactions were small-area (below 200 pings) cases. Meanwhile, demand for co-working spaces and business centers increased, reflecting market preference for smaller, flexible offices.

New supply pipeline expected to create short-term vacancy pressure

Net absorption was positive around 6,300 pings in Q2. Among all submarkets, the Others submarket showed the strongest absorption, primarily concentrated in the Huang Hsiang Taipei Main Station Building leasing, with its vacancy rate decreasing by 1.2%.

In addition, approximately 28,000 pings of new office supply is scheduled to enter the market in the second half of 2025. This substantial influx of inventory is expected to exert upward pressure on vacancy rates, especially in the Others submarket.

Rental growth rate decelerates for two consecutive quarters

Taipei CBD rental rates displayed minimal movement in Q2, with quarterly growth of just 0.07% and year-on-year growth holding at 0.63%, indicating a softening rental performance across prime office locations as the market responds to changing economic conditions.

Despite this slowdown, Taipei CBD still maintained positive momentum, with average rents increasing from NTD3,196 to NTD3,216 per ping per month compared to the same quarter last year. This modest yet steady growth shows market stability despite challenges.