According to the new Property Market Monitor research from global real estate consultancy JLL, Hong Kong's total Grade A office rents contracted further in September 2020.
Rents in Hong Kong continued to fall across all major office submarkets, with the overall demand falling 1.3 percent m-o-m in September after falling 1.7 percent in August. Compared to an average rental decline of over 2% per month in the first half, the rental decline has slowed. COVID-19 seemed to be more contained, which contributed to the change. عقارات قطر | عقارات | شقق للبيع
Rental pressure was more pronounced in Hong Kong Island's conventional core office submarkets, where rents fell more than 1.5 percent month over month as demand remained poor and vacancy rates rose.
As a result of decentralizing tenants, a considerable amount of space in Central was returned to the market, resulting in net absorption of -243,500 square feet. The vacancy rate in Central increased to 6.8% following the return to the leasing market of office space formerly occupied by the Securities and Futures Commission after the company moved to Hong Kong East.
A few versatile space operators took space in Causeway Bay to open new centers, resulting in low demand. Compass Offices, for example, has leased an office space at Lee Garden Two with a lettable floor area of 15,700 square feet, and Sky Business Centre has leased an office space at Times Square with a gross floor area of 17,000 square feet. Sullivan and Cromwell rented a 14,000-square-foot office at Alexandra House in Central to move from another Grade A building in the city.
According to Paul Yien, Senior Director of Markets at JLL in Hong Kong, "The overall leasing demand in the office sector is still low, as many businesses are taking a wait-and-see approach. However, we've seen a range of businesses lease new office space in order to consolidate their offices in various locations and upgrade when landlords are able to offer more flexible leasing terms."
Nelson Wong, Head of Research at JLL in Greater China, added, "In the property investment sector, "In September, office property sales remained sluggish, with only a few strata-titled office floors worth more than HKD 20 million changing hands. Last month, retail investment activity was also sluggish, particularly in high-traffic areas. Since the retail sector is primarily supported by local demand, investor attention has remained concentrated on assets in non-shopping areas. This year, we expect the pattern to continue."