Rents in the world’s costliest office market, Hong Kong, may fall for the first time in four years as an equities rout weighs on sentiment in the financial hub.
Grade-A office rents in Central and Admiralty will decline by about four percent in 2019, Colliers International Inc. said in a report. That compares with an estimated gain of 9 percent this year.
Declines in stocks this year “must” have undermined confidence at the financial firms that rent more than half of the Grade-A office space in the central business district, the property brokerage said. Looming interest-rate increases and the U.S.-China trade war will also take a toll on sentiment, it said.
Office occupancy costs in Central stand at $307 per square foot, topping London’s West End and Beijing’s Finance Street, according to CBRE Group Inc.
“Overall confidence among financial occupiers in Hong Kong remains high,” said Andrew Haskins, Asia head of research at Colliers. “While US-China trade tension continues to be headline news, it has yet to make a tangible impact on Hong Kong’s business environment.” Bloomberg