Zhongguancun, favored by DeepSeek and ByteDance, is drawing strong interest. Amid China's real estate slump, Zhongguancun, known as "China's Silicon Valley," is the only area buzzing with activity thanks to a rush of IT companies.
According to the South China Morning Post (SCMP) on the 11th, global real estate consultancy Knight Frank named Zhongguancun, a district dense with advanced technology companies, as the only area in Beijing where office rents rose, in a recent report.
The companies that leased additional office space in Zhongguancun in the second quarter are impressive. ByteDance, the parent company of TikTok, along with leading artificial intelligence (AI) firms DeepSeek, Moonshot AI, Rank Computing and Suanmiao, flocked to the area. Thanks to them, the vacancy rate for Grade A offices in Zhongguancun, which had exceeded 14% at the end of last year, fell to 8.2% in the second quarter of this year.
Rents also jumped. The average monthly rent for Grade A offices in Zhongguancun in the second quarter was 251.4 yuan (about 55,000 won) per square meter, up 0.3% from the first quarter. This is the second-highest level in Beijing after the financial district. By contrast, Beijing's citywide average vacancy rate was 15.9%, up 0.1 percentage point from the first quarter.
In the second quarter, technology, media and telecommunications (TMT) companies accounted for 49% of Beijing's office leasing market. Finance made up just 17%.
"This year marks the arrival of the AI super cycle, and it is only just beginning," a Knight Frank official said. "Leasing demand led by related technology companies will continue in Beijing over the next three to five years and will actually accelerate further." However, the official expected a full-fledged market rebound to appear at the end of 2029 or early 2030.
