New supply pushes Grade A office vacancy up to an all-time high of 11.9 million sq ft

Q3 saw an additional 1.8 million sq. ft. of new office space.

Grade A office vacancy hit another all-time high of 11.9 million square feet (sq ft) in Q3, translating to a vacancy rate of 14.1%.

Year-to-date, the vacancy rate rose by 2 percentage points.

According to CBRE, vacancy rose further in the third quarter due to the additional 1.8 million sq. ft. of new office space –- the most since Q3 2008.

Across submarkets, Kowloon East recorded the highest vacancy rate (20.2%), followed by Tsim Sha Tsui (13.2%), Wanchai, Causeway Bay (11.5%), Hong Kong East (11.1%), and Greater Central (8.1%).

Kowloon East’s vacancy rate in Q3 was the highest since Q1 2010, according to CBRE.

With high vacancy, the market also saw a faster decline in rents, falling 1.0% QoQ. The year-to-date fall now stands at 2%.