Hong Kong office market gains momentum on eased Covid restrictions
According to the latest news from JLL Hong Kong Property Market Monitor Report, the Class A office market regained momentum in April due to the easing of social distancing measures. Overall net absorption was 249,000 square feet as tenant demand was sustained in addition to the completion of new supply.
The overall vacancy rate remained at 9.4% at the end of April due to the completion of new supply. The vacancy rate in Central increased slightly to 7.4% while Kowloon East continued to record the highest vacancy rate among the major office submarkets at 12.8%.
Overall net effective rents for Class A offices remained stable in April. Among the major office submarkets, Central saw marginal rent growth of 0.1% mom, while Tsimshatsui fell 0.9% mom, the largest rent decline among the submarkets. markets.
Alex Barnes, Head of Agency Leasing at JLL in Hong Kong, said: “Demand for Class A office leasing in Hong Kong remained firm in the first quarter, despite a significant impact on working from home. distancing measures in April. We think market sentiment will continue to improve.”
On the other hand, the commercial rental market continues to be negatively affected. Nelson Wong, Head of Research at JLL in Greater China, commented, “Some retailers still postponed their expansion plans due to the unstable market situation, however, a handful took advantage of the limited bargain-hunting opportunities. and committed to new retail outlets. The investment market also picked up slightly in April, with some major transactions recorded. Notably, a ground floor to mezzanine store (5,200 sq. ) of the Yip Fung Building in Central was sold to private investor Douglas Young for HKD 165 million.