Overall Grade A office market records positive net absorption in February

HONG KONG, March 20, 2025 – The overall Grade A office leasing market recorded a positive net absorption of 7,200 sq ft in February, according to JLL's latest Hong Kong Monthly Market Dynamics released today.

Financial occupiers continue to focus on prime locations. Notably, financial intuition KGI leased two floors, totalling 39,200 sq ft of lettable area, at One Pacific Place in Admiralty for business expansion. On Kowloon side, the flight-to-quality trend remains prevalent among tenants. Ralph Lauren Sourcing Company Limited leased two floors, with a total Gross Floor Area of 66,000 sq ft, at 83 King Lam Street in Cheung Sha Wan, upgrading from an industrial building in the same district.

Alex Barnes, Managing Director at JLL in Hong Kong, said: "The office leasing market has been more active since early this year, with increased expansion demand from insurance, private wealth, and education sectors. Another key driver is the corrections in rents for quality office buildings have reached attractive levels, making it more affordable for occupiers to seize the opportunity to upgrade office spaces."

Cathie Chung, Senior Director of Research at JLL, said: "Overall rents continued to decline in February, with a marginal m-o-m drop of 0.5%. Rents in Central and Wanchai / Causeway Bay both experienced decreases, falling by 0.4% and 0.2%, respectively. Meanwhile, Hong Kong East recorded the largest rental drop among all submarkets, with a decrease of 1.3%. Kowloon East also saw a rental drop of 0.5%."

The overall vacancy rate remained steady at 13.3% at the end of February. Among submarkets, Central's vacancy increased from 11.3% to 11.5%, while the vacancy rate in Wanchai / Causeway Bay continued to improve, decreasing by an additional 0.2 percentage points. In contrast, Hong Kong East's vacancy rate rose to 13.2%.

Source: JLL Research