JLL: This year, the vacancy rate of office buildings in Hong Kong is expected to rise to 18.9%, with rents expected to drop by another 10% in Central.

Savills Hong Kong consultant and executive director of transaction services, Phoebe Fung, stated that by 2025, it is expected that China's economic policies may stimulate IPO activities in Hong Kong and boost the development of the financial industry. It is predicted that from 2024, the leasing market atmosphere for office buildings will improve, with new leasing volume expected to increase by 5% year-on-year. The additional supply may lead to a vacancy rate rising from the current 17% to 18.9%, involving over 17 million square feet, and rents are expected to further decrease by 5% to 10%. Savills also mentioned that the leasing activity in Hong Kong slowed down in the fourth quarter of 2024, with a 38% decrease in total leasing volume compared to the previous quarter, at 661,000 square feet. The total leasing volume for the year reached 4.3 million square feet, a 6.3% increase from 2024. The net absorption in the fourth quarter of 2024 was negative, at -191,500 square feet, bringing the total for the year to 956,000 square feet, the highest level since 2018. The net absorption in the Central District was negative at -24,900 square feet in the fourth quarter and -10,800 square feet for the year, making it the only district in Hong Kong with negative net absorption for the year. Overall vacancy rates increased by 0.2 percentage points to 17.0%. The vacancy rates continued to rise throughout 2024, affecting 15.2 million square feet. Excess vacancy rates led to a 1.7% decline in rents in the fourth quarter of 2024 compared to the previous quarter, with a 6.3% decrease for the year, exacerbating from the 5.5% decline in 2023.