JLL: Grade A office rents in Central Hong Kong rose for the first time since May 2022.

On November 24th, Jones Lang LaSalle (JLL) released its "Hong Kong Property Market Observations" report, stating that in November, Grade A office rents in Central increased by 0.1% compared to the previous month, marking the first month-on-month growth since May 2022. The vacancy rate of high-quality Grade A offices in the area improved, putting landlords in a favorable position during rent negotiations. Alex Barnes, Managing Director of Jones Lang LaSalle (JLL) in Hong Kong, Macau, and Taiwan, said that many tenants took advantage of the significantly lower rents to upgrade and expand their office space, leading to a significant increase in leasing rates in Central this year. This trend has stabilized Grade A office rents in Central and contributed to the slight increase last month. Key transactions in the market include MIGAO GROUP relocating from Causeway Bay China Resources Building to Phase II of Chong Hing Center in Central, involving a floor area of approximately 10,201 square feet for expansion. Meanwhile, as of the end of October, the overall vacancy rate continued to decline gradually to 13.1%. Senior Director of Research at Jones Lang LaSalle (JLL), Chung Chuyu, stated that the vacancy rates in Wan Chai/Causeway Bay and Tsim Sha Tsui have significantly improved, dropping to 10.5% and 7.5% respectively. The vacancy rate in Central, however, increased slightly by 0.5 percentage points to 11.5%, mainly due to some tenants vacating floor space in the area that has not yet been taken up. The Grade A office market recorded a positive net absorption of 293,300 square feet in October, mainly due to tenants actively engaging in consolidation and upgrade activities in a favorable market environment. Overall office rents remained relatively stable month-on-month, but there were divergent trends in different market areas.