Overall net effective Grade A office rents rise by 0.2% m-o-m in October

HONG KONG, 23 November 2021 – Overall net effective rents of Grade A office market rose by 0.2% m-o-m in October, the first time since the last peak in May 2019. Among the major office submarkets, both Central and Tsimshatsui registered rental growth during the month, according to JLL's latest Hong Kong Property Market Monitor released today.

Overall net absorption was 107,200 sq ft in October. There were more instances of expansion recorded in the market, while tenants continued to look for wellness amenities and flexibility in the workplace. In one such instance, business center operator IWG leased two floors of 23,400 sq ft (gross floor area) at Tower 535 in Causeway Bay to open a new center to meet the growing demand for flexible space.

The leasing market was active in Central during the month. Notably, an investment management firm leased a floor of 13,900 sq ft (net floor area) at One Exchange Square to relocate within the submarket.

Nelson Wong, Head of Research at JLL in Greater China, said: “As tenants are continuing to look for wellness amenities and flexibility in the workplace, landlords should be aware of this trend and the growing demand for such, and enhance the amenities in their office spaces,”

On the industrial sector, Wong noted: "The values of merchandise trade continued to expand in September. Aggregate trade value registered a steady increase of 20.0% y-o-y, with total imports and exports rising by 23.5% and 16.5% respectively. Despite supply bottlenecks in many places around the world, local demand continued to support the leasing market in October. For instance, third-party logistics company DSV expanded its presence at Modern Terminals Warehouses – Phase II in Kwai Chung by leasing approximately 57,500 sq ft."

Source: JLL Research