20/7/2018-9

Colliers International: The core area of ​​the commercial building

In the first half of the year, the property market showed a good trend. Nigel Smith, managing director of Colliers International (Hong Kong), believed that the factors such as low interest rate, good economy and short supply were all coordinated. In the second half of the year, property prices have not shown any signs of decline. The trend is the best, and driven by the policy, the property in Tuen Mun District is also worthy of attention.

In the first half of 2018, the property market performed well, regardless of the residential, commercial and industrial buildings. The high property prices are supposed to increase the risk. However, Shi Lixian believes that the property market has not seen a crisis. On the contrary, it is very confident because the basic factors are very satisfactory: “Hong Kong’s economy has grown by 3.7% to 3.8%. The low interest rate environment continues to provide the most basic positive factors. Compared with the 1997 price drop, he thinks that the current background is very different. “According to the analysis of many economists, the low interest rate is expected to last for a long time. Even if the interest rate rises, it will rise to 10 to 15%. It is impossible. In addition, the average number of mortgages undertaken by the public is very low, the ability to hold goods is strong, the owners are mainly users, and there are not many speculators. Coupled with high market transparency, various factors are difficult to compare with those of 20 years ago. ."

Small and medium-sized residential prices rose 15% year-on-year

Another key factor is the large market demand and insufficient supply. “After the Brexit, the property market in Hong Kong was up two years ago. As Asia became the choice of global capital investment, Hong Kong also benefited. In addition, insufficient supply, not only residential, office buildings Shops are also under-supplied. As long as demand is strong and supply is insufficient, property prices are unlikely to come back."

He expects that the property industry will increase across the board this year. In the residential market, small and medium-sized residential units outperformed luxury homes, an increase of 15%, while luxury property prices rose by about 7%.

In various areas, he expects the price increase and rental increase of Jiaxia to be the best. In fact, this year, the whole building and the layered Jiasha are all seeing the indicators. For the whole commercial building, the Chinese-funded consortium recently purchased the third and fourth towers of Taikoo Shing Center from Swire Properties (01972) for a total of $15 billion. There is also a $8 billion change in Kwun Tong Auto Teng Plaza. Shi Lixian said that the whole building is hard to find, so the price of each transaction is ideal. “It is difficult for the owners to sell the whole building. As the property prices rise, there is no need to stock up. In recent years, Chinese institutions have purchased all commercial buildings for their own use. Recently, With the control of funds in the Mainland, the situation has decreased. On the contrary, local investors are more aggressive than Chinese buyers."

Continued expansion of the CBD is a good thing for Hong Kong

In terms of rents, rents in the core areas have hit record highs. He believes that the rents of commercial buildings in Central are hosted by several major industries and will not be sold and managed better. “5 million square feet of floor space, 1.6 million square feet of National Gold Phase II, rented by the owner’s long-term line, not available for sale, better management, less supply and lower prices. Demand, except for Chinese-funded institutions Multinational companies have also expanded."

The rent of Jiasha hit a record high, and he pointed out that the business district is expanding and is no longer limited to Central. “The 2% vacancy rate in Central is unhealthy. The normal vacancy rate should be about 5%. At present, the CBD is expanding. It used to mean Central, but in fact, Admiralty and Wanchai are also part of the core area. Take the core business district of London as an example. The price of the property is almost the same. Hong Kong has convenient transportation. The rents in Central and Wan Chai are $140 and $72 respectively. In fact, it is only a five-minute drive. I believe that the CBD will continue to expand and it is a good thing for Hong Kong." As for other commercial districts, Hong Kong Island East and East Kowloon are also ideal. “After opening the Central Wan Chai Bypass, Central to the Island East is convenient. In addition, the development of East Kowloon is only about 10 years, and the potential for development into the second CBD is great."

Visiting Hong Kong passengers rebounded

In the retail market, he pointed out that rents have rebounded this year. The number of visitors to Hong Kong has rebounded. Drugs, cosmetics and lifestyle goods have become sought after. It is expected that first-line street rents will rebound throughout the year and second-tier streets will be stable.

As for the areas worthy of attention, he specifically mentioned Tuen Mun. The foundation was built as a key factor. “The Hong Kong-Zhuhai-Macau Bridge is about to be completed. Together with the Tuen Mun-Chek Lap Kok Link Road, Tuen Mun is convenient to the airport, Macau and Zhuhai. At present, online shopping is prevalent, and logistics demand is high. The demand for logistics centers in the region is expected to increase."