Chongqing - The latest Jones Lang LaSalle (JLL) report, released January 18, reveals Chongqing's Grade A office buildings, now over 3.7 million square meters and ranked sixth nationally, are defying the national trend with a reduced average vacancy rate of 26.6%, down 0.9 percentage points from last year, contrasting with rising rates in other major Chinese cities.

Chongqing's GDP surpassed three trillion yuan in 2023, joining an elite economic group. Zhou Yi of JLL West China credits this to the "33618" modern manufacturing system upgrade. 

The "33618" modern manufacturing cluster system of Chongqing is to form three dominant industrial clusters for electronic information manufacturing, intelligent connected and new energy vehicles, and advanced materials, while Chongqing is strengthening efforts to foster its six key industrial sectors.

Zhou continued that the city surpassed Shanghai in industrial added value, ranking second nationally in the first three quarters of 2023. This growth is mainly due to the development of the Chengdu-Chongqing economic circle and the New International Land-Sea Trade Corridor (ILSTC), boosting industrial and commercial exchanges.

ILSTC has launched a rail-sea intermodal train to Africa. (Photo/ Huang Wei)

Chongqing's Grade A office buildings saw a 5.3% decrease in average rent in 2023, the biggest drop in nearly a decade, marking a significant shift in industry dynamics. This change is primarily attributed to the growth of "hard technology" sectors, such as industrial and automotive software, following Chongqing's "Full of Stars" action plan.

Areas like Zhaomushan Technology Innovation Park and Xiantao International Big Data Valley have become hubs for advanced IT enterprises. These high-quality companies are now expanding from industrial parks to Grade A office buildings. 

Interestingly, in 2023, more than half of the tech sector's office space deals were in IT software and game development, marking a notable shift from the earlier emphasis on new media and online education.

A bird's eye view of the Zhaomushan Technology Innovation Park area. (Photo/Chen Wensen)

Chongqing is becoming a financial hub, evidenced by seven of China's eleven microfinance companies with over 5 billion yuan in registered capital headquartered there. This reflects the city's rising prominence in the microfinance sector, supported by its favorable regulatory environment.

Top internet-backed microfinance companies like Chongqing Jingdong Shengji Microfinance Co., Ltd. are leveraging this growth. They're boosting investments and driving demand for Grade A office spaces in Chongqing while expanding their operations.

Besides, the consumer market in Chongqing showed a remarkable recovery in 2023, driven by increased retail sales and a boost from the holiday economy. This recovery was reflected in a significant decrease in the vacancy rate of commercial spaces to 15.2%.

Chongqing's retail sector is evolving, driven by strategic adjustments from the main commercial authority, signaling market confidence. Key developments in the third quarter include the opening of Hill 5 at Starlight 68 Plaza and the refurbishment of Chongqing Time Paradise Walk Pavillion A and B, indicating a shift in shopping mall positioning.

The Chongqing Time Paradise Walk intersection in Yuzhong District is lit up with Dragon-themed decorations. (Photo/Niko Wu)

Zhu Jianhui, Head of Retail Real Estate and Consumer Research of JLL China, is optimistic about the changing retail landscape. He highlights the challenge of blending modern commercial and architectural designs with Chongqing's distinct culture and history and the necessity for innovative, interactive, high-quality commercial spaces to cater to the increasing demands of consumers, especially the younger generation.