Hong Kong's office vacancy rate is expected to reach 19 percent at the year's end, with the full-year rents falling 4 to 5 percent, as new supply continued to weigh on the sector, said CBRE.
As office supply is projected to fall next year, vacancy rates and rents will not get worse in the following periods, the commercial real estate services and investment firm said.
In the three months ended in September, net absorption of Grade A offices hit the highest level of 691,800 square feet since the third quarter of 2018.
Office vacancy rate inched down by 0.3 percent quarterly to 17.1 percent in the third quarter, while rents recorded a decrease of 0.7 percent, signaling a slowdown trend.
In the retail market, CBRE estimated a full-year rental growth of 3 to 4 percent in high street shops, citing the recovery of market sentiment.
Besides, the commercial property market saw 33 deals in the third quarter, boosted by strong end-user demand.
The total investment reached HK$8.65 billion, represent a decline of 8 percent.
CBRE said more Chinese companies are seeking to invest in commercial properties in Hong Kong, believing that this trend will continue in the medium and long term.
Also, as the huge gap in the supply of student hostels and policies supporting drove investors' interests in developing student accommodation, its investment is expected to account for 20 percent of the total this year, it added.
