Commercial buildings will be completed in the next 2 years with 4 million baht
In the next two years, the peak supply period for commercial buildings will be 4 million square feet. The vast majority of non-core areas include Hong Kong Island East, East Kowloon and Wong Chuk Hang.
The new floor focuses on non-core areas
According to data from DTZ, there are a lot of new supply for commercial buildings in this and next year. This year, 1.8 million square feet of floor space will be completed, and next year there will be a new supply of 2.2 million square feet of floor space, totaling 4 million square feet.
With an annual average commercial building absorption of 1.2 million square feet, the supply is higher than demand, which poses some pressure on rents.
With regard to new supply, there will continue to be zero new supply in Central District in the next three years. New buildings will mainly appear in East Kowloon. Taking next year as an example, East Kowloon will be launched at a floor of 1.4 million square feet, accounting for 64% of the new supply next year. In fact, the Government proposed to start Kowloon East in the early years. Many developers and investors have started buying new buildings in East Kowloon.
Apart from East Kowloon, Wong Chuk Hang is another emerging commercial area. Since the opening of the South Hong Kong Island Line last year, traffic has improved greatly. Many developers have moved to the area to purchase industrial buildings for reconstruction.
There are also new commercial buildings completed in Wong Chuk Hang this year. For example, Swire and China Island’s South Island Place have a total gross floor area of approximately 380,000 square feet. The 30-storey commercial building, with a layered floor area of approximately 14,000 square feet, is a rare commercial building in the district. It is expected to be completed by the end of this year. The project is currently under hiring and the intention is to lease more than 30 yuan.