Seoul prime office rental growth slows to 4.8% in Q4

This is from a 7.1% growth recorded in the previous quarter.

In a recent report, Savills said average Seoul prime office rents, which previously recorded the highest YoY increase of 3.1% since the global financial crisis, continued a trend of over 7% YoY growth throughout Q4/2022 to Q3/2023 for four quarters in a row. 

However, the report said growth slowed to 4.8% in Q4/2023, down from 7.1% in Q3/2023. In CBD, Gangnam Business District (GBD) and Yeouido Business District (YBD), rents rose by 4.6%, 4.5% and 5.9% YoY to KRW122,200/sq m, KRW120,600/sq m, and KRW100,100/sq m, respectively, driven by rental hikes in nine prime offices through new leases or lease renewals. 

“In Q4/2023, management fees increased by 3.2% YoY, with CBD at 4.1%, GBD at 1.4%, and YBD at 4.5%. Similar to rental growth, the increase in management fees decelerated from the previous quarter. Over the past two years, rental growth rate has outpaced inflation, while the rise in management fees during the same period has remained below the inflation rate,” added Savills.