Chung Yuan (commercial property): Prices of Hong Kong commercial properties are expected to drop by up to 10% in the first quarter of 2026.

Pan Zhiming, the managing director of Centraline (Commercial) Limited, expects that the trend of renovating student dormitories will continue to drive strong buying and selling activities in the commercial property market. In the first quarter of 2026, there were approximately 940 transactions with a total transaction amount of about 12.6 billion Hong Kong dollars. The transaction volume and prices are expected to increase compared to the fourth quarter of 2025, with prices likely to stabilize or fall by 10%. Rental performance is expected to remain steady, with about 3,600 lease transactions in the first quarter, but rental levels are expected to continue to soften, stabilizing or falling by 15%, while transaction volume is expected to increase moderately. As for the office market, Chen Yanlou, director of the office department of Centraline (Commercial) Limited, mentioned that the market is still driven by buyers, leading to relatively pressured prices. It is predicted that the price per square foot of office space will remain stable in 2026, with certain areas seeing a potential decline of about 5%. It is believed that more strong buyers will enter the market actively as prices become more favorable, with about 240 transactions expected in the first quarter of 2026, involving a total transaction amount of about 6 billion Hong Kong dollars. Rental performance is expected to remain steady, with approximately 1,500 lease transactions in the first quarter, mirroring the trends in buying and selling prices with a decrease of within 5%. In the industrial property market, Liu Chongxing, director of the industrial department of Centraline (Commercial) Limited, predicts that there will be about 500 transactions in the first quarter, with a total transaction amount of about 3.6 billion Hong Kong dollars. Property prices are expected to remain relatively stable, with certain areas like Wong Chuk Hang, Chai Wan, and Kwun Tong having a potential decline of about 5%. Due to high vacancy rates in industrial properties, there is anticipation for the government to reassess and increase the usage of industrial properties, as well as speed up the approval process for renovating industrial properties to stimulate transactions. Rental performance is expected to improve further, with rental trends expected to stabilize or decrease by 5%, and about 1,200 lease transactions in the first quarter. In the retail market, Pan Zhiming noted that there is a surplus of retail units for sale and low rental prices, which deters potential buyers from entering the market, resulting in a weak market. It is predicted that there will be about 200 transactions in the first quarter of 2026, with a total amount of about 3 billion Hong Kong dollars, and prices are estimated to decrease by 5% to 10%. In terms of leasing, approximately 900 transactions are expected, with rental levels remaining under pressure, particularly in core areas where rents are expected to decline by about 10%, while non-core areas could see declines close to 10% to 15%.