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1st-quarter real estate transactions drop 37%

TAIPEI, Taiwan -- Real estate transactions dropped to NT$35.8 billion in the first quarter, which was a 37-percent decrease year-on-year and the lowest record since the financial crisis in 2009, according to global real estate service company CBRE.

Transactions of commercial real estate dropped further. Transactions totaled NT$7.7 billion in the first quarter, which was about a 70-percent decrease year-on-year. About half of commercial real estate transactions completed in the first quarter were made by companies in need of business space.

Companies seem to be increasingly acquiring real estate outside Taipei City. Nan Shan Life Insurance (南山人壽) spent NT$1.3 billion on an office building in Jungli City, Taoyuan County. Mercuries Life Insurance (三商美邦人壽) spent NT$820 million to acquire an office building located in Kaohsiung City. CBRE pointed out that both these locations were not considered popular investment destinations.

Nevertheless, CBRE still believes that downtown Taipei has potential, as investors in privately offered funds are looking for quality real estate in the area. CBRE forecasts more transactions to occur in the area in the next two quarters.

Land transactions in the first quarter totaled NT$28 billion, which was a 14-percent decrease. However, CBRE said the transaction amount is not a far cry from the average figure in the past. Half of the buyers were real estate developers, who spent NT$15.3 billion on land purchases all over Taiwan. It is a sign that construction companies are still active and optimistic about Taiwan's real estate market, analysts said.

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