COMMERCIAL PROPERTY | Staff Reporter, Hong Kong

Office rents up 0.9% in June

This translates to an average monthly rent of $73.9 psf.

Hong Kong’s office market remained heated after rents inched up 0.9% YoY in May translating to an average monthly rent of $73.9 psf, according to real estate consultant JLL.

Central also emerged as the world's most expensive prime office market for the third consecutive year with office occupancy costs of a whopping $2,405 psf. 

Also read: Half-year commercial property investment activity hits $89b as office market remains heated

Strong leasing demand from banking and finance firms buoyed office capital values to new heights with net office take up hitting 106,600 sqft in June. In fact, half year net absorption rate of 1.5m sqft already smashed last year’s full record of 1.2m ft. 

Notable transactions include AIA relocating from their Stubbs Road office and leasing around 100,000 sqft at Hopewell Centre in Wanchai and a fintech company leasing 29,7000 sqft at Lee Garden One in Causeway Bay. Another fintech firm, Block One, also reportedly leased 16,600 sqft at The Centrium for its first office.

The sale of Cityplaza Three and Cityplaza Four in Quarry Bay to Henglilong Investment Limited for $15b or around $19,491 psf is setting a record for the Hong Kong office market in terms of lump sum, JLL added.

A series of massive en-bloc office transactions drove commercial property investment activity in the past six months, CBRE said in an earlier report.

“Office remains the most popular asset class and the rising rents and low vacancy will continue to ensure its capital value growth, ”said Tony Ng, senior director, capital markets, CBRE Hong Kong.

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