Hong Kong's office vacancy rates continued to improve across Central, Wan Chai North, Kowloon East and Tsim Sha Tsui, according to property consultancy Knight Frank's latest Hong Kong Monthly Report.
Premium Central offices stayed the market's top pick, with vacancy falling to 9.7 percent in July from 14.5 percent at the beginning of the year, limiting large-floor premises. Meanwhile, Sea-view offices in Central and Wan Chai North drew strong interest. Robust enquiries for existing and upcoming harbor-facing spaces enhanced landlords' negotiating position, lifting rents and cutting vacancy for these units.
Kowloon office leasing picked up in July, fueled by demand for larger floor plates. Vacancy fell to 21.5 percent in Kowloon East and 7.3 percent in Tsim Sha Tsui. Kowloon Central, particularly The Gateway, remained one of the market's most in-demand office hubs. New West Kowloon Grade-A offices are reshaping leasing dynamics, pushing landlords to prioritize tenant retention and flexible terms.
Residential sales cooled in July after a strong first half. Primary home transactions totaled 796, down 60 percent month-on-month, while secondary deals reached 3,666, falling 35 percent amid cautious market sentiment. The leasing market remains vibrant as the Knight Frank Luxury Rental Index recorded a 9.2 percent increase year-on-year in July. Prime residential rents stayed elevated, contributed by talent inflows and education-related demand.
Prime Central retail showed resilience. The recent sale of 32 Cochrane Street, Central for HK$75 million achieved a 15.7 percent capital gain over three years. Brentwood Coffee's expansion highlighted continued demand from café and lifestyle brands looking to tap into Central's office workforce and tourist traffic.
Frank Feng
