Firms upgrade HK offices as rents fall

Companies are jumping on the opportunity to upgrade to bigger and better offices amid Hong Kong's rare property downturn.

Jefferies Financial has moved from Li Ka-shing's Cheung Kong Center to Two International Finance Centre; ByteDance has relocated to One ifc and law firm Stephenson Harwood has leased One Taikoo Place in Quarry Bay, switching from United Centre in Admiralty.

Tenants in Kowloon are also moving to Hong Kong Island to be closer to the central business district, with premium spirits company Edrington Group upgrading from Exchange Tower at Kowloon Bay to a 16,700-square-foot space at Swire Properties's (1972) Two Pacific Place.

With slowing demand and an impending influx of supply, Grade-A office rents are 31 percent lower than in 2019, according to JLL data.

"Right now we've got a lot of nice buildings, whereas in the past even if you wanted to get in you can't get in," said Colliers' head of landlord representation Chris Hui. "With Hong Kong's overall vacancy at around 15 percent, it's giving occupiers the opportunity to go in, look for better stuff and at more affordable rental levels."