Hong Kong, mainland China office-leasing outlook bleak even as mood brightens across Asia-Pacific: CBRE

Leasing market professionals in Hong Kong and mainland China are overwhelmingly pessimistic at around negative 20 per cent, according to a CBRE survey

Hong Kong’s office vacancy rate stood at 14.7 per cent in the fourth quarter of 2023, rising from 12.9 per cent in the third quarter, according to Savills

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Sentiment among property-leasing professionals in Hong Kong and China is the poorest in Asia-Pacific, according to CBRE. Photo: Bloomberg

Published: 8:30am, 20 Mar 2024

The commercial property leasing market across most Asia-Pacific markets is improving, except in Hong Kong and mainland China where sentiment is particularly downbeat, according to CBRE.

While respondents in South Korea and Japan were the most positive at just under 40 per cent, the sentiment was overwhelmingly pessimistic Hong Kong and mainland China at around negative 20 per cent, according to a report by the property consultancy on Tuesday that surveyed some 320 leasing market professionals across the region.

“Mainland China and Hong Kong were the only markets to report negative sentiment, indicating that more time will be needed for these markets to recover,” the study said. “Half of the respondents expect rents and incentives to remain flat.”

Respondents in the mainland and Hong Kong also expect office rents to decline further.

The outlook for Hong Kong’s office sector looks bleak. The overall office vacancy rate in the city rose to 14.7 per cent in the fourth quarter of 2023, edging up from 12.9 per cent in the third quarter, according to Savills. The consultancy said it expects office rents to decline between 5 per cent and 10 per cent this year owing to massive new supply coming on stream and uncertain demand.

On the mainland, the office sector is also likely to remain a tenant’s market this year, according to JLL.