Luxury serviced apartment operators in Shanghai are suffering from rising vacancies and falling rents as a result of an abundance of new supply that has come to the market at a time when multinational corporations have frozen expansion.

The decline in demand for serviced accommodation from expatriate executives is unlikely to end soon, say property consultants, who predict that rents for such apartments will fall a further 10 per cent this year.

This would follow a fall in rents in the sector of as much as 20% for the year so far, said Lee Hing-yin, the director of research and advisory for East China at property consultancy Collier International.

South China Morning Post