5% increase in 2016 Grade-A office rents in core areas predicted

Thanks partly to strong demand.

It has been noted that in 2016, Hong Kong’s Grade-A office rents in core areas is expected to increase 5%, given strong demand for office space and extremely low vacancy rates.

According to a research note from Knight Frank, further, rents in decentralised areas may slightly drop by 5% due to abundant supply in the pipeline.

Meanwhile, in 2015, Hong Kong office sales market recorded strong performance with several large-scale, en-bloc transactions having been concluded.

Here's more from Knight Frank:

Mainland companies are expected to continue to buy en-bloc buildings and lease office in CBD in 2016 amid rapid business expansion. They will be the key drivers for new take-up and office acquisition in the next three to five years.

Nelson Lam, Director of Commercial Agency at Knight Frank says, “Chinese firms, especially financial institutions, will remain major drivers of both new take up and en-bloc office acquisition next year thanks to the greater cross-border financial integration such as the Shenzhen-Hong Kong stock connect.”