Grade A office vacancy falls to 12.5% in August

Financial firms led office leasing, whilst education operators expanded their footprint.

Overall Grade A office vacancy fell 0.3 percentage points month-on-month (MoM) to 12.5% as the market recorded positive net absorption of 332,700 square feet in August, broadly in line with the previous month, according to JLL’s report.

The financial sector remained the main source of leasing demand, whilst the education sector continued to expand its office footprint amidst government efforts to develop the city as an international education hub.

Tsimshatsui (6.4%) and Kowloon East (19.5%) recorded the greatest improvements in vacancy, with rates in both submarkets falling 0.3 percentage points.

Meanwhile, vacancy in Hong Kong East rose 1.1 percentage points to 14.1%.

Office vacancy in Central hit 7.8%, whilst Wanchai / Causeway Bay recorded 9.7%.

Average Grade A office rents increased 0.9% MoM, led by Central, where rents rose 1.5%. However, rents in Hong Kong East and Kowloon East declined 0.3%.