Flexible office space offsets corporate downsizing: JLL
Leasing momentum in the retail market continues to improve in August 2021.
JLL's latest Hong Kong Property Market Monitor released 23 September reveals corporate downsizing activities due to the pandemic were offset by the upgrading demand and expansion of the flexible office space sector.
For instance, Compass Offices expanded in-house at Lee Garden One in Causeway Bay and Infinitus Plaza in Sheung Wan, while Regus leased another floor at The Gateway Tower 5 in Tsim Sha Tsui.
Head of leasing agency Alex Barnes said, "Despite a handful of buildings recording slight rental growth during the month, overall net effective rents dipped 0.1% month-on-month in August. Among the major office submarkets, Wanchai/Causeway Bay and Kowloon East experienced a larger rental decline, whereas rents in Central remained stable."
The vacancy rate in Central rose to 7.7% as of end-August. Some tenants opted to relocate to relatively more cost-effective locations, demand for premium office space in the submarket remained healthy. Notably, Chinese investment bank CICC reportedly took optionality expansion at One International Finance Centre as part of their renewal.