Grade A office market records negative net absorption in Q4 2024

Despite this, it reached 956,000 sq. ft. for the full year, the highest since 2018.

The Grade A leasing market recorded a negative net absorption of 191,500 square feet (sq. ft.) during the fourth quarter (Q4) of last year, according to CBRE.

Despite the negative absorption, it reached 956,000 sq. ft. for the full year, the highest since 2018. 

Greater Central reported -24,900 sq. ft. of net absorption in Q4, bringing the full-year figure to -10,800 sq. ft., the only submarket with a negative annual figure.

Kowloon East was the weakest submarket, with -104,200 sq. ft. of net absorption for the quarter, but was the strongest for the full year, with 231,200 sq. ft.

In the same period, the overall vacancy rate increased by 0.2 percentage points year-on-year in Q4 2024 to 17% due to the absence of new supply and negative net absorption.

"Office leasing sentiment is projected to improve with new leasing volume predicted to grow by 5% year-over-year. However, significant new supply may push vacancy rates higher from the current 17%, and rents are expected to decline by 5% to 10% in 2025," Ada Fung, executive director, head of advisory & transaction services – Office Services at CBRE Hong Kong, said.