KUALA LUMPUR, Dec 3 — Rental yields for office space here grew by just 2.1 per cent in the third quarter of 2019, according to Knight Frank’s Asia Pacific Prime Office Rental Index.

The growth was 0.4 per cent lower than in the previous quarter, amid what the global property consultant described as a “cooling” global economy.

It credited the marginal increase to the opening of two new towers in the TRX financial district: The Exchange 106 and Menara Prudential.

“However, with Kuala Lumpur city’s overall office market still under pressure and landlords continuing to offer attractive lease packages to retain or attract tenants.

“The sector is expected to remain challenged in the short to medium term,” the firm said when announcing the index.

Rental for prime office locations in Hong Kong has plummeted 5.6 per cent due to the continuing pro-democracy protests in the city as well as increasingly harsh tactics authorities are using to suppress the special administrative region of China.

Other locations that recorded quarter-on-quarter declines were Shanghai (-1.1 per cent) and Beijing (-0.8 per cent) in China, and Manila, the Philippines (-0.4 per cent).

Australian office space appeared to be enjoying a revival, with the major cities of Sydney, Melbourne, Perth and Brisbane all reporting increased growth.

Singapore’s absolute rental yields declined by 0.6 per cent during the same period, but this still represented an improvement from the previous quarter.

Malaysia continues to experience a surplus of high-end office, commercial and residential space that has left the local property market stagnant.