Swire Set to Add New Taikoo Place Tower Despite Hong Kong Office Slump

Swire Properties is set to add an office tower reaching as high as 20 storeys to its Taikoo Place campus in Hong Kong’s Quarry Bay after completing a more than decade-long quest on Friday to secure a site next to its Lincoln House property. 

Having bought up more than 93 percent of the space in a pair of ageing walk-ups along Tong Chong Street in an aggregation which began in the early 2010s, the HKEX-listed developer secured the final piece of the Hoi Wan and Sea View buildings at a compulsory sale which the company sees enhancing the value of its commercial hub on eastern Hong Kong Island.

“We plan to redevelop this site into a premium, Grade A office tower as part of our ongoing placemaking and asset reinforcement strategy for Taikoo Place,” a Swire spokesperson told Mingtiandi. “We are confident that the project will further strengthen Taikoo Place’s position as a leading global business district.”

The company is committing to adding an eleventh building to Taikoo Place even as it struggles to lease up Two Taikoo Place, a one million square foot (92,903 square metre) tower completed in 2022, and office vacancy in Hong Kong East stands at 13.3 percent, according to April figures from JLL. 

Quarry Bay Expansion Continues

Merging the plots beneath the Hoi Wan and Sea View buildings, which stand across Tong Chong Street from Swire’s Dorset House and PCCW Tower, gives the developer a 20,211 square foot site where it can develop up to 303,166 square feet of commercial space, according to Bobby Mak, real estate valuer at Hong Kong-based CHFT Advisory and Appraisal.

That would make the new tower around 90 percent of the size of Lincoln House with Swire likely to commit much of the new project to office space, along with lower floor retail, according to Mak. Based on the plot size and the maximum gross floor area, and given Hong Kong guidelines of site coverage in commercial projects, Mingtiandi estimates the new project’s height at up to 20 floors.

The new tower brings Swire’s active development pipeline in Quarry Bay to approximately 1.5 million square feet across three projects.

About a two-minute walk from the Tai Koo MTR station on Hong Kong Island’s eastern corridor, Swire plans to develop two adjacent plots — 8 Shipyard Lane, the former Wah Ha Factory Building, and 1067 King’s Road, the former Zung Fu Industrial Building — for office and other commercial uses with 779,000 square feet of total gross floor area, the company said in its 2025 annual results.

Swire is also jointly developing a residential project with Henderson Land at 983 to 987A King’s Road and 16 to 94 Pan Hoi Street in Quarry Bay, which is expected to provide 404,738 square feet of private residential space and a retail podium of 49,936 square feet. That project is slated for completion in 2028.

Soft Office Market

Swire is continuing its Quarry Bay expansion despite Two Taikoo Place having reached only about 70 percent occupancy at the end of 2025, almost three years after completion, according to the company’s annual results.

Occupancy in Swire’s older Taikoo Place offices declined to 88 percent at the end of 2025 from 91 percent a year earlier, with rents on new leases and renewals signed in the fourth quarter averaging 15 percent below earlier contracts, the results show.

Cushman & Wakefield reported that net effective rents in Hong Kong East stood at HK$30.8 per square foot per month in the first quarter of 2026, down one percent from the end of 2025. The consultancy’s availability rate for the submarket — which includes space expected to become vacant within 12 months — stood at 16.5 percent at the end of March. CBRE forecast Hong Kong East rents to fall a further 4 to 6 percent over the full year of 2026.