HK - Commercial Properties & REITs

[winston]

Prime office vacancies soar to 21-year high

by Kevin Xu

Grade A office rents will fall 15-20 percent this year, says CBRE . SING TAO

Vacant Grade A office space hit a 21-year high of about 7.8 million square feet in September, according to CBRE, with a unit at Admiralty Centre available for rent at HK$38 per sq ft - close to the average office rent in Kowloon West.

CBRE expects Grade A office rents in Hong Kong will fall 15 to 20 percent this year, noting that Grade A office rents have fallen 13.8 percent in the first three quarters of this year.

CBRE also estimates the vacancy rate of Hong Kong Grade A offices will reach 10 percent at the end of the year from 9.6 percent in the third quarter.

Meanwhile, high-street shop vacancies in four core districts - Central, Causeway Bay, Tsim Sha Tsui, and Mong Kok - rose 4.8 percentage points to 18.3 percent in the third quarter from the second quarter.

High street shop rents fell 5.7 percent quarter-on-quarter in the third quarter, said CBRE.

"Significant rental drops since last year, however, encouraged some local brands to explore leasing opportunities at low costs that had not existed for many years".

Source: The Standard

https://www.thestandard.com.hk/section- ... -year-high

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[winston]

Cushman & Wakefield: Grade A Office Rents May Dive 16% Deeper Next Yr

John Siu, Managing Director of Cushman & Wakefield (Hong Kong), foresaw at an online conference that enterprises will stay exposed to headwinds next year after going through a pandemic-hit tough year in 2020.

Looking into 2021, Siu expected the rents at Grade A offices to slide 16% steeper, whereas vacancy rates at offices may climb higher to roughly 14%.

Source: AAStocks Financial News

[behappyalways]

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[winston]

Hong Kong’s worst recession on record points to bleak outlook in 2021 for residential property and commercial real estate prices

Mass market and luxury home prices are expected to drop between 5 and 10 per cent in 2021 on lower transaction volumes, say analysts

The pandemic will affect the uptake of grade A offices, with Cushman & Wakefield predicting rents to fall between 11 and 16 per cent this year

Source: SCMP

https://www.scmp.com/business/article/3 ... esidential

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[winston]

Foreign Banks Lead Retreat From Hong Kong’s Pricey Office Market

By Shawna Kwan

Lenders from BNP Paribas to UBS are reducing office space
Trend may continue as firms prioritize cutting costs this year

Office rents will fall by 7% in 2021 while cost optimization will remain the main concern for tenants.

Rental value in the city plunged 17% last year, the most since 2009.

Source: SCMP

https://www.bloomberg.com/news/articles ... ice-market

[behappyalways]

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https://m.youtube.com/watch?v=k6oOjmaOfsM

[winston]

Commercial space surplus forecast

A surplus of commercial buildings could occur in the next two years and the rental incomes may be suppressed, a report from Savills shows.

Although the rental drop softened in the first quarter, the scale of enterprises has shrunk.

The overall Grade A office rents fell by 3.5 percent on a quarterly basis in the first three months, dropping for seven consecutive quarters.

In the fourth quarter last year, rents fell by 5.1 percent.

Hong Kong Island rents fell by 4 percent, while Kowloon rents fell by 2.8 percent.

The office vacancy rate increased to 8.9 percent. The vacancy rate of Central offices hit a 15-year high, rising from 7.3 percent to 7.6 percent.

Savills expects the overall vacancy rate to reach 10 percent.

Source: The Standard

https://www.thestandard.com.hk/breaking ... s-forecast