Analysis of the Decline in Office Occupancy Rate of China World Trade Center and Demand Changes in Beijing CBD

Based on data obtained from searches and market reports, I provide the following systematic analysis:

According to the 2025 Q3 Report of China World Trade Center (600007), the office building business of the company’s core asset, China World Trade Center, shows the following key indicator changes [1]:

This data indicates that China World Trade Center, a landmark property in Beijing CBD, has indeed seen a dual decline in occupancy rate and rent.

According to Knight Frank’s Q3 2025 Beijing Grade A Office Building Market Report, the market conditions of the CBD area are as follows [2]:

• The CBD’s vacancy rate of 14.4% is lower than the city-wide average (17.8%), indicating that the core location still has resilience against declines
• The city-wide vacancy rate dropped 0.6 percentage points from the previous quarter, and the market is showing signs of
  bottoming out and stabilizing
• Net absorption has grown for two consecutive quarters, reaching 75,597 sq m in Q3 2025

The 0.9 percentage point decline in China World Trade Center’s occupancy rate and 5.0% drop in rent

1. Impact of Tenant Structure Adjustment
   • China World Trade Center mainly serves foreign-invested enterprises, financial institutions, and high-end service industries
   • In recent years, foreign-invested enterprises have contracted their strategies in China, with some organizations reducing office space or relocating to lower-cost areas
   • State-owned and central enterprises, guided by policies, have moved back to self-owned office buildings, exerting pressure on market-oriented leasing [2]

2. Intensified Market Competition
   • Emerging business districts around the CBD (such as Lize, Tongzhou) have diverted some demand with lower rents
   • The vacancy rate of Lize Business District dropped 2.6 percentage points to 22.9% this quarter, indicating a demand spillover effect [2]

3. Strategy of Exchanging Price for Volume
   • China World Trade Center’s rent dropped from RMB 645 to RMB 613, a decrease of 5%
   • This reflects the pragmatic strategy of the property owner to maintain occupancy rate through price reductions

The demand in Beijing CBD is undergoing

1. It is an individual case
   : China World Trade Center’s occupancy rate (92.3%) is still significantly higher than the CBD average (14.4% vacancy rate = 85.6% occupancy rate), and its 0.9 percentage point decline is within the range of normal fluctuations

2. It is a microcosm
   : The downward trend is consistent with the overall “exchanging price for volume” market strategy of Beijing CBD, reflecting:
   • Enterprise office demand is shifting to “cost-effective” options
   • Traditional core areas are facing competition from emerging business districts
   • Enterprise expansion has become cautious amid macroeconomic uncertainty

• CBD rents are expected to remain under pressure, but the decline is expected to narrow
• The vacancy rate may fall slightly amid slowing supply and moderate demand recovery

• Approximately 757,000 sq m of new supply is expected to enter the market, with about 409,000 sq m in the CBD [2]
• The supply peak may exert periodic pressure on the vacancy rate

• High-quality properties are enhancing their competitiveness through hardware upgrades, LEED green certification, and other measures
• Customized services, turnkey occupancy, etc., will become standard offerings from property owners
• The market will further tilt towards tenants

1. The decline in China World Trade Center’s occupancy rate
   does reflect the adjustment period that the Beijing CBD office building market is undergoing, but the extent is relatively mild (only 0.9 percentage points)

2. Demand in Beijing CBD is not contracting
   , but rather structurally optimizing:
   • Demand from high-tech, finance, and professional services continues to be released
   • Demand from traditional foreign-invested enterprises has contracted, but this has been offset by emerging industries

3. The market is in a critical stage of supply-demand rebalancing
   , and is expected to gradually stabilize amid slowing supply and moderate demand recovery

4. Location-quality linkage
   has become a new trend, and high-quality properties in the core area still have long-term allocation value

[1] China World Trade Center 2025 Q3 Report (http://money.finance.sina.com.cn/corp/view/vCB_AllBulletinDetail.php?stockid=600007&id=11570408)

[2] Knight Frank: Beijing Grade A Office Building Market Quarterly Report Q3 2025 (https://content.knightfrank.com/research/1527/documents/zh-chs/bei-jing-xie-zi-lou-shi-chang-bao-gao-2025nian-q3-12472.pdf)