Hong Kong Office Rents To Rise

Centre O INCORPORATION

Any entrepreneur needs a place to establish its company. Of course, he must consider the area, but also the amount of the rent. It is a parameter that should not be neglected. Indeed, the landlords may

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increase the price. On top of that, Hong Kong has become one of the cities where the rent is highest. According to a Demographic International Housing Affordability Survey, published in January 2014, the property market is the most expensive with an annual rental of US$181,42 per sq. on average. HK office space is more than twice expensive compared to other global cities. Therefore, more and more business starters choose to develop its company in a co working space.

Nonetheless, we estimate that Hong Kong will worth US$ 70,000 per sq. meter in 2015. This is more than Singapore, which is ranked second at US$28,340 per sq. meter (more than 3 times than London). By 2019, we are expecting a rise of 10% in prime office rents. Offices are ranked by grades (A, B or C) and therefore are more or less serviced.  Around 59% of Grade A commercial properties are owned by local developers for the past years. Furthermore, Hong Kong is going through a rapid de-industrialization combined with a constraint of the inner-city areas. As a result, the most strategic place to develop a Grade A office appears to be in the inner-city area.

In the Global Financial Centres Index (March 2015), Hong Kong is ranked third just after New York and London. The city is perpetually developing. The fusion of Kwun Tong, Kowloon Bay and Kai Tak to create the biggest Grade A office hub is under processing and will boost up the prices even more.

There is actually a huge demand of co work spaces. In 2012, near 2000 co work spaces providers were registered against 75 in 2007. A flourishing market which is shared by around 165 competitors.

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