Office Leasing in Central Hong Kong Spikes 47% in September
Strong demand from the banking and finance sectors
According to JLL's latest monthly Property Market Monitor
released this past week, new office lettings in Central Hong Kong surged 47% month-over-month in September 2017.
Solid office leasing demand from the banking and finance sector in the Hong Kong Land portfolio contributed to new lettings in Central surging 47% from 45,100 sq. ft in August to 66,300 sq. ft last month. In one of the largest deals, The Stock Exchange of Hong Kong reportedly leased 13,900 sq. ft at One Exchange Square for in-house expansion.
The realization of pre-commitments at K-11 Atelier, which was issued its Occupation Permit during the month, and ongoing tenant decentralization contributed to net take-up in the overall market amounting to 295,000 sq. ft in September. Notable movers included Covestro reportedly leasing 20,300 sq. ft at One Island East and IMG leasing 13,000 sq. ft at Dorset House, both relocating out of offices in Wanchai-Causeway Bay.
Alex Barnes, Head of HK Markets at JLL said, "Activity in general has picked up as attractive and low cost new supply comes to the market in Kowloon East and new buildings on Hong Kong Island are both completing and nearing completion stage. These include 18 King Wah Road in North Point and One Taikoo Place in Quarry Bay, which are fielding strong inquiry from tenants. Leasing demand will remain strong as we head towards the end of year."
"The tight vacancy situation and resilience of the Central Hong Kong office market continues to draw the attention of investors with record high transaction being set in a number of office buildings, in terms of unit rate. We expect this trend to continue over the near-to-medium-term despite ongoing tenant decentralization", commented Denis Ma, Head of Research at JLL.