City's office vacancy rate nears 17pc

Hong Kong's office vacancy rate rose to a new high of 16.9 percent in the second quarter of this year, with a total of 15 million square feet vacant, CBRE said.

About 631,100 sq ft of new office space was supplied in the past three months, bringing the total new supply for the first half of the year to around 1.5 million sq ft.

The new supply drove the vacancy rate in Central to surge, rising to 14 percent in the first half of the year, the highest level since June 2004.

The rising vacancy rate has continued to pressure rents, with Grade A office rents falling 1.6 percent quarter-on-quarter, a faster drop compared to the 0.6 percent decline in the first quarter.

Marcos Chan Kam-ping, executive director and head of research at CBRE Hong Kong, expects office prices to fall by 10 percent this year, while retail and store prices are expected to rise by 5 percent.

Melody Chen