This comes as new MTR lines are completed.
Demand for office space in Wong Chuk Hang and Hung Hom doubled in the first quarter of 2017 after the completion of new MTR lines, according to CBRE’s Q1 2017 MarketView Report.
Leasing momentum in Hong Kong’s retail and industrial sectors also registered an uptick, supported by improving retail sales.
“The completion of new MTR lines has spurred relocation demand. We have already seen some tenants from core locations moving to Wong Chuk Hang and Hung Hom. Looking forward, we expect more occupiers to decentralise as rents become more affordable and the travel time is much shorter now,” said Marcos Chan, Head of Research, CBRE Hong Kong, Southern China and Taiwan.
Here's more from CBRE:
Office leasing momentum slowed marginally in Q1, with net absorption dropping 5% q-o-q to 197,000 sq. ft.. Leasing activity was dominated by large transactions made outside core areas, such as Freshfields Bruckhaus Deringer’s decision to decentralise a large portion of its office functions to Quarry Bay.
PRC financial firms remained a key driver of leasing demand in Central while activity in Kowloon and the New Territories was mostly driven by retail occupiers.
The net absorption in Wong Chuk Hang increased to 156,700 sq. ft. in the first quarter from 68,300 sq. ft. in Q4 2016 while Hung Hom saw a net take-up of 10,077 sq. ft. in the first quarter from net decrease of 18,300 sq. ft. in Q4 2016.
Grade A office rents continued to increase, rising by 1.6% q-o-q. This was led by demand on Hong Kong Island. Rents in Kowloon and the New Territories were flat.
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