Office market posts positive take up in February amidst 5th COVID-19 wave

Net absorption in February was 276,500 square feet.

Amidst the tightened COVID-19 measures during the fifth wave, the Grade A office leasing market recorded positive net absorption of 276,500 square feet (sq ft) in the overall market last month as tenant demand continued to recover, JLL said.

The real estate services firm also noted that the overall vacancy rate declined to 9.1% as of end-February 2022 from 9.4% recorded at the end of January 2022. Amongst the major office submarkets, Kowloon East registered the highest vacancy rate with 12.4%.

Alex Barnes, head of agency leasing at JLL in Hong Kong, said the recent surge of COVID-19 infections had relatively minimal effects compared to the first wave of the 2020 outbreak.

"Decision-makers have been in this position before and long-term plans continue to hold firm across the majority of the office leasing market," said Barnes in a statement.

On the retail market, Nelson Wong, head of research at JLL in Greater China, noted that some retailers remained confident in the market and committed to new outlets due to more affordable rentals. 

“The investment of retail properties also remained active last month, with several sizeable deals recorded in non-core areas," added Wong, in the same statement.