24/9/2018-7

Central Jiaxia rent continues to rise

There is a continuing shortage of supply in the core area. According to the latest “Hong Kong Property Market Watch” report released by Jones Lang LaSalle, the average Grade A office rent in August was about 75 yuan, up 0.7% month-on-month. By region, the new lease volume of Central Jiaxia was down by month. 51%, but rents continued to rise, increasing by 0.9% month-on-month.

Central Grade A office rents continue to rise.

The report pointed out that due to the tight supply of commercial buildings in Central, the rents of super-grade office buildings in the district increased evenly, rising by 1.6% month-on-month, reflecting that the best quality buildings continue to be sought after by the market.

Non-core supply increases

In fact, companies engaged in financial-related industries have been active in the leasing market in recent months and are looking for opportunities to expand in traditional core business districts. The most notable rental case is the cryptocurrency trading platform BitMEX, which is located in the office of the New Territories. The rent for each party is 225 yuan, and the full floor of the 45th floor of the Central Bank of the Yangtze River Group is leased, covering an area of ​​about 19,200 square meters. The building has a new record.

Grade A office partition vacancy rate

The bank also mentioned that due to the extremely low vacancy rate of office buildings in the core area, many companies have to move to other parts of Hong Kong Island. The strong rental demand in Wan Chai and Causeway Bay also recorded a considerable increase. Rents rose by 1% month-on-month.

As for the supply of commercial buildings in non-core areas, there is an increasing trend. For example, South Island Place in Ka Wuk Keng District has obtained occupation papers in August, which will bring about 307,200 square feet of office space supply to the district. In the next 12 months, there will be about 452,000 square meters of commercial leases in the East Kowloon area. The market rent will increase in a short period of time or the overall net absorption will continue to be under pressure.

Bao Yali, head of the commercial department of Jones Lang LaSalle, said that despite the continuing trade dispute between China and the United States, the Hong Kong office rental market remained strong under the basic factors of supply and demand. The rent of Jiaxia in most of the district markets rose further last month.

However, he pointed out that East Kowloon will usher in a new round of new supply peaks in office buildings. In the case of rising vacancy rates in the region, it is expected to curb overall rental growth in the coming months. However, the increase in supply in the region also provides tenants with the opportunity to move out of the core business district.

Nearly 10% of the vacancy rate in the East Kowloon

Information shows that as of the end of August, the overall vacancy rate of the company was about 4.2%, up 0.3 percentage points month-on-month. The office space in East Kowloon in the non-core area was the most serious, with a high ratio of 9.9%, 0.3 percentage points higher than that in July. The ratio of Hong Kong Island East reached 1.6%, which was 0.2 percentage points more month-on-month.

The vacancy of office buildings in the core area is still at a relatively low level. The ratio of Central and Wan Chai/Causeway Bay is 1.5% and 1.6%, while that of Tsim Sha Tsui is 1.4%, which is 0.1% less than the month.

Although the overall non-core area is vacant, the Kwun Tong commercial area still attracts many companies to enter, and the rents of commercial buildings are not bad. The authority of the Central Plains Office of the Office of the Central Plains said that the renting of Room B, 18th Floor, Wan Zhao Feng Centre, No. 133, Haibin Road, is about 12,595 square meters, accounting for about half of the floor. The latest intention is about 29.5 yuan, which involves more than monthly rent. 370,000 yuan, the unit will be handed over to the end of this year, suitable for corporate rent for the purpose of the group headquarters.