Hong Kong Island to see ‘moderate’ office rental growth in H2
Rents are more affordable compared to pre-pandemic levels.
Office rent in Hong Kong Island is expected to grow moderately in the second half of the year, Knight Frank reported.
This comes as Knight Frank observed that current rents, particularly in prime locations, have become more affordable compared to pre-pandemic levels.
“We expect demand for prime locations to continue to grow and support overall leasing momentum, driving moderate rental growth in 2H22,” the report read in part. The property consulting firm also noted that this has fueled trends to recentralise.
In the first half of 2022, overall Grade A office in Hong Kong Island slipped by 0.7%. Despite this, the overall monthly rents in Central and Admiralty grew by 0.4% each to HK$114.7 and HK$73.9 per square feet in June, respectively.
“Apart from the strong rivalry among office buildings to retain tenants, competition between landlords and co-working service providers is also fierce,” Knight Frank noted.
“Unlike traditional leasing contracts, landlords are now more willing to offer flexible lease terms and provide fully fitted space for tenants. With the downward adjusted rent, more tenants are reconsidering the traditional office options.”