Here are the biggest revelations from HK property firms' recent results

Spot, passing rents are to converge.

It has been noted that the Hong Kong property companies’ reporting season is now two-thirds complete with 10 out of 15 companies having reported. Three main messages have emerged, including the observation that spot and passing rents are starting to converge with some negative rental reversions setting in.

According to a research note from Barclays, as the office and retail rental market enter the third and second year of slow down, respectively, spot and passing rents are starting to converge.

In the office market, both Champion and HK Land reported negative rental reversions in 2H 2014. With the headroom between spot and passing rents narrowing, for the 10 companies to report thus far, net rental y/y growth slowed from 10% in 1H 2014 to only 4% in 2H 2014.

Here's more from Barclays:

Given the high vacancy level at Champion REIT’s Citibank Plaza (25% as of December 2014), it is not surprising that passing rents had corrected to HK$77.53psf from HK$82.07 as of June 2014.

However, considering that Hongkong Land’s portfolio vacancy had remained low generally low at 5.4% (from 6.0% at 30 June 2014), as rents began to be renewed from 2011’s peak levels, rental reversions have been negative from 2H 2014.

With the office and retail leasing market entering a third and second year of anemic growth, respectively, overall rental growth has started to slow. Of the 10 companies to report thus far, average gross and net rental growth was only 5.6% and 3.8%.

Although net rental growth remains positive for the most part, compared to 1H 2014’s 9.8% rental growth, 2H 2014’s average rental growth of 3.8% represents a sharp deceleration.