Office vacancy rate in Hong Kong’s Central falls to single digits after 2 years

Prime office vacancy rates in Hong Kong’s main business district dropped to single digits for the first time in 26 months, lifting overall rents in the city’s struggling office property market, according to JLL.The vacancy rate in Central for premium offices fell to 9.9 per cent in February from 10.1 per cent the previous month, the property consultancy said. The last time a single-digit rate was recorded for grade A offices in the district was in December 2023, when it also hit 9.9 per cent, according to JLL’s data.The citywide prime office vacancy rate also inched down to 13.4 per cent in February from 13.5 per cent a month earlier, with the Wan Chai and Causeway Bay area recording a decrease to 10.2 per cent from 10.3 per cent in its third straight month of falling rates.Given the improvement, Central’s grade A office rents rose 3.5 per cent in the first two months of the year, after rising 1.2 per cent in January and 2.3 per cent in February, JLL said. This increase supported a 1.1 per cent month-on-month rise in overall office rents in February, the company said.Central’s grade A office rents rose 3.5 per cent in the first two months of the year. Photo: Jelly Tse“With the banking sector remaining the primary driver of leasing activity, and demand focused on new office buildings in core business districts, only two districts have shown early signs of improvement,” said Alex Barnes, managing director of JLL in Hong Kong, Macau and Taiwan.“This trend is expected to persist throughout the year, while noncore districts such as Kowloon East are likely to remain under pressure,” Barnes said.