Ares Doubling Office Space at Hongkong Land’s Gloucester Tower in Central

Hongkong Land on Monday announced a new lease with Ares Management that will see the US investment firm double its office space at the Jardine Matheson-controlled builder’s Gloucester Tower in Hong Kong’s Central district.

Effective March 2026, Ares will add 12,500 square feet (1,161 square metres) to its existing space in the 48-storey building where it has been a tenant since 2017, Hongkong Land said in a release. The 1980-built Gloucester Tower forms part of Hongkong Land’s Landmark commercial complex in the city’s prime business precinct.

Ares has aggressively expanded its Asia Pacific footprint in recent years, first with the 2020 acquisition of Hong Kong-based distressed debt specialist SSG Capital and later with the 2023 purchase of Singapore-based private equity firm Crescent Point Capital. Last March the Los Angeles-based firm acquired the ex-China funds business of industrial giant GLP for $3.7 billion.

“We are delighted that Ares has chosen to expand in Hongkong Land’s Central portfolio, underscoring our position as the location of choice for financial services firms as we provide an unparalleled community of innovative services, world-class amenities and superb connections for our tenants,” said Neil Anderson, director and head of office with the commercial property division of Hongkong Land. “The broader flight to quality trend solidifies our leading position in building experience-led city centres.”

Rents Perk Up

The lease’s duration and rental rate weren’t provided. In its half-year results released last July, Hongkong Land said average office rents in its Central portfolio slid to HK$95 ($12.10) per square foot per month in the January-June period from HK$103 during the year-earlier period.

Average leasing rates in Central’s prime buildings climbed 2.5 percent in the final weeks of 2025 as demand from hedge funds and other finance firms helped reverse a six-year slide, according to Cushman & Wakefield. Analysts at the consultancy tied rising rents to a recovery in the city’s financial markets.

Hongkong Land in November reported a 13 percent year-on-year drop in third-quarter underlying profit, driven by lower contributions from the Central portfolio. But the London-listed builder highlighted a pair of disposals that helped it reach 50 percent of its target of recycling at least $4 billion in capital by the end of 2027.

At the end of October, Hongkong Land completed the sale of Southeast Asia developer MCL Land to Malaysia’s Sunway Group for $579 million. Net proceeds from the divestment amounted to $657 million.

The MCL divestment followed the company’s first key capital-recycling transaction in April, the sale of office floors and retail spaces at One Exchange Square to the Hong Kong Stock Exchange for HK$6.3 billion ($810 million). 

Another Jardines-controlled unit acted as the seller in Hong Kong’s biggest office transaction of 2025, with Mandarin Oriental having completed its $925 million disposal of the top 13 floors of One Causeway Bay to Alibaba and its Ant affiliate on the last day of the year.

Fund Management Shift

Hongkong Land last month unveiled details of its first-ever private fund, a Singapore-focused vehicle with expected assets under management of S$8 billion ($6.2 billion), as the builder moved ahead with its strategy to become a fee-earning manager of third-party capital.

Singapore Central Private Real Estate Fund will be seeded with Hongkong Land’s one-third stakes in Marina Bay Financial Centre Towers 1 and 2 and One Raffles Quay, as well as the developer’s 100 percent interest in One Raffles Link.

The four assets in Singapore’s downtown core have a combined attributable value of S$3.9 billion, and SCPREF aims to launch in the first quarter of 2026 with AUM more than double that of the seed portfolio to establish itself as the Lion City’s largest private real estate fund.

The establishment of SCPREF aligns with Hongkong Land’s goal, announced in 2024, to grow AUM to $100 billion by 2035 through a combination of LP capital partnerships, private funds and REITs.