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News Release

Hong Kong and Macau

Office market remains robust amid tight vacancy and strong demand

Monthly office rentals in Central returns to the HKD 100 per sq ft level


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HONG KONG AND MACAU, 15 October 2015 – The Hong Kong office market continued to perform well in September, backed by the strong leasing demand, the overall office vacancy rate remained at a low level of 3.0%, according to JLL’s Hong Kong Property Market Monitor​ research report published this October.

Net take-up for the overall office market amounted to 184,000 sq ft in September, up slightly from August’s 151,400 sq ft.  While office vacancy rates remained low across all sub-markets, growth was largely supported by demand in Wanchai/Causeway Bay and Central, where net take-up amounted to 61,400 sq ft and 23,800 sq ft respectively. 

Central recorded several new lettings in September.  Notable examples included the in-house expansion at Cheung Kong Centre by an American hedge fund (about 6,700 sq ft lettable) and the take-up of about 1,600 sq ft lettable at Two IFC by a Chinese regional bank.

In Hong Kong East, the planned redevelopment of several older buildings led a number of tenants committing to new leases for relocation purpose.  Examples include the in-house relocation (19,000 sq ft lettable) at Cityplaza 3 by Thomson Reuters and the take-up of two floors or 27,000 sq ft lettable in Dorset House by ISS, a global facility services provider.

In Causeway Bay, Tower 535 was issued its Occupation Permit in September.  About 20% of the building’s lettable space has been leased to a fitness centre and a club house operator.  The landlord is targeting tenants from the media/technology and banking and finance sectors for the remaining space.

Denis Ma, Head of Research, Hong Kong at JLL, said, “New lettings in Central were dominated by smaller requirements owing to the limited supply of sizeable stock.  For leasing deals in Hong Kong East, demand was mainly driven by relocation requirements from tenants being affected by the upcoming redevelopment of Swire Properties’ techno centres in Quarry Bay.”

“The Central office market continued to rebound, with its monthly rentals returning to the HKD 100 per sq ft level in September for the first time since the European Sovereign Debt Crisis in 4Q11,” Ma added.

In the investment market, investors continued to be keen in acquiring office properties in Central, on the back of the broad-based recovery in rentals.  In September, Emperor International Holdings purchased Wincome Centre from Wincome Group for a total consideration of HKD 1.3 billion (HKD 33.310 per sq ft).  This is the biggest office sale transaction recorded so far in 2015.  

Grade A Office Vacancy Rates
PeriodOverallCentral

Wanchai /

Causeway Bay

Hong Kong EastTsimshatsuiKowloon East
End September3.0%1.2%2.1%0.7%1.6%6.1%
End-August3.0%1.3%1.7%0.7%1.6%6.2%
Source: Research, JLL