04 Apr 2011
According to Knight Frank, on the back of further growth in the local economy, Hong Kong continued to witness robust office leasing activity in February 2011. The corporate sector continued to expand rapidly, but with little office space available, rents rose significantly as landlords raised asking rents more aggressively.
Traditional Central continued to lead the market last month, where rents grew another 5.4% after surging 6.3% in January, followed by North Point and Quarry Bay, where rents both rose 5.0%. Rents in Tsim Sha Tsui also gathered pace, growing 3.6% last month — the largest month-on-month increase since December 2009.
Activity in the office sales market was brisk in the past month, with more speculators shifting from the residential market, where interest has curtailed after the introduction of various government cooling measures. Grade-A office properties were particularly attractive to investors, as they offered higher rental yields (3.2% in December 2010) than luxury homes (2.5% in the same month).
「In the 2011–2012 Budget, the government has proposed to include 16 commercial sites on its 『List of Sites for Sale by Application' for 2011–2012, which could provide over six million sq ft of office and retail space. However, given that it would take a minimum of four years to develop such sites into new offices, office supply in CBD will remain tight in the foreseeable future. Amid limited supply and continual demand for office premises, we maintain a positive outlook for the office market and forecast a rent growth of 20–30% this year,」 Knight Frank's report concludes.
Source: Knight Frank
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