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新型コロナウイルスの感染拡大に伴い，東京都などの自治体と事実上国からなされている，事業者への休業要請が都市部を中心に続いています。この休業要請については，「補償なき休業要請」であると  の声も一部にはなおあるところです。これについては，国のレベルでは，厚生労働省が否定するとともに，事業主が労働者を休業させた場合に支払われる休業手当には「雇用調整助成金」の助成があり，助成率も引き上げられている旨などを公表しており，また，経済産業省は，「持続化給付金」を給付する旨公表しその申請の受付と給付を開始しています 。さらに，自治体のレベルでは，東京都が，休業要請に応じた事業者に，「感染拡大防止協力金」を給付する旨公表しその申請の受付を開始しています 。
 

The Grade A and B office markets both saw impressive rental growth over the year. Nevertheless, a COVID-19-induced market slowdown is likely to materialise during late-2020.

•  Vacancy rates remain extremely low in the central five wards (C5W), and rents have picked up once more. That said, momentum is expected to peter out as the market grapples with the impact of the COVID-19 pandemic.
•  Average rents in the C5W Grade A office market grew 1.0% quarter-on-quarter (QoQ) and 7.1% year-on-year (YoY) to JPY37,759 per tsubo1 per month.
•  The average Grade A office vacancy rate in the C5W was steady over the quarter and year, holding at around 0.3% as of Q1/2020.
•  Average rents for large-scale Grade B office space rose to JPY28,558 per tsubo per month, growing by 1.3% QoQ and 6.5% YoY.
•  Like its Grade A counterpart, the average large-scale Grade B office vacancy rate saw minimal change this period, standing at 0.3%.

China is the world’s second-largest economy and its second-largest consumer market (13.1% in 2018) having overtaken Japan in 2005, as well as being one of the fastest-growing large markets. International retailers have been placing increased importance on the market with some making China its regional headquarters. Meanwhile…

China is the world’s second-largest economy and its second-largest consumer market (13.1% in 2018) having overtaken Japan in 2005, as well as being one of the fastest-growing large markets. International retailers have been placing increased importance on the market with some making China its regional headquarters. 

Meanwhile, domestic brands are growing in confidence, experience and markets share and have started to expand internationally. These brands, having grown up in China, are incredibly nimble and have a native understanding of the unique challenges and opportunities in China—from innovation speed, distribution and marketing channels (social ecommerce, live streaming, KOLs, etc.).

They are incredibly disruptive and innovative, as well as gaining in scale, number and influence. Gone are the days that China would look to the west for inspiration.

As COVID-19 continues to spread across the world without an end in sight, global capital markets have unsurprisingly been hit hard and the J-REIT market has suffered more than most. Yet, under the current circumstances, it is easy to forget that J-REITs had performed solidly up until 20 February – when the TSE REIT Index peaked at over 2,250 (Dividend: 3.5%, NAV: 1.28). Things swiftly changed thereafter, however, as the index lost around half of its value over the course of the following month, plummeting to 1,145 (Dividend: 6.8%, NAV: 0.69) by 19 March. A modest recovery to 1,640 (Dividend: 4.8%, NAV: 0.97) by 25 March notwithstanding, the index has hovered around the 1,500 mark (Dividend: 5.2%, NAV: 0.90) since the start of April – around 30% below its preCOVID-19 high. 

As reported in the semi-annual survey by the Japan Real Estate Institute (JREI) and BAC Urban Projects, rental growth in Tokyo’s prime retail submarkets on the whole was impressive during 2H/2019. Average 1F rents increased by 4.9% half-year-on-half-year (HoH) and 14.9% year-on-year (YoY). As for Non-1F rents, growth in this sector has yet again exceeded its typically more volatile 1F peer, rising 8.8% HoH and 15.9% YoY. As such, for the first time, non-1F rents in all submarkets sit above JPY30,000 per tsubo per month. At the submarket level, 1F rents in Ginza remain streets ahead of rivalling districts, whilst the spread between average non-1F rents remains tight.

The COVID-19 pandemic continues to depress office rents during the month, with rents in Central and Admiralty dropping 18.6% and 22.2% YoY, respectively, extending the decline to 11 consecutive months. With current rents adjusted significantly downwards, cost-conscious occupiers started to seek bargain deals in the down market, triggering more leasing activity than in the previous month. In Island East, however, as office vacancies remained at a low level (Quarry Bay: 0.5%, North Point: 5.1%), rents in the area remained stable.
 

The effects of the continuing COVID-19 pandemic were of course the main factor impacting the Asia Pacific property market in the first quarter. Signs of the outbreak weighing on sentiment were seen in markets across the region, however robust government stimulus packages and policies are cushioning impacts, and opportunities are emerging across many sectors in the region. In Hong Kong the virus exerted further downward pressure after a prolonged period of political and economic uncertainty, keeping major players on the sidelines. Similarly in Singapore uncertainty has begun to limit activity in both the residential and commercial sectors. Private equity inflows into India’s real estate market have slowed to a trickle and investments in dynamic emerging markets like Myanmar have been put on hold.