Hong Kong Office Rents Edged Upwards in December Despite Rising Vacancy

Average rents for grade A offices in Hong Kong rose 0.4 percent in December as rising demand in the city’s core business district counterbalanced rising vacancy from completion of new buildings in the Asian commercial hub. 

Office leasing rates averaged HK$46.5 ($5.96) per square foot per month at the end of December, according to a report by property consultancy JLL on Thursday, with a 0.6 percent increase in rents Central district, home to the stock exchange and the city’s largest banks, helping to buoy the broader market. 

“Leasing activity remains steady, and enquiry levels in January have stayed robust,” said Alex Barnes, managing director for JLL in Hong Kong, Macau and Taiwan. “Top‑tier office buildings in Central are particularly active, and we expect other premium buildings in the district to benefit from spillover demand in the second half of the year, as a number of prime towers are now close to full occupancy.”

The increase in Central district rents continues an upward trend which emerged earlier in the fourth quarter, with the home of prime properties like Exchange Square and the IFC complex having seen rents rise by 2.5 percent during September and October, according to a report last month by Cushman & Wakefield.

Central Back in Demand

The rent uptick in Central came despite vacancy edging up to 11.0 percent at the end of December  from 10.9 percent a month earlier, according to JLL’s figures, with that shift coming after vacancy in the district had declined 0.6 percentage points during the full year of 2025, the consultancy said.  

The rising rents may result in part from landlords gaining encouragement from steady tenant demand, with occupiers in Hong Kong having now taken up more space than they handed back to landlords for nine consecutive months, according to JLL. While completion of new buildings helped to push up vacancy, the net gain in space leased versus space given up in Hong Kong’s office market during December reached 537,000 square feet in December, the agency said. 

Earlier this month Hongkong Land announced that Ares Management is doubling its footprint in the developer’s Gloucester Tower property in Central with the US private equity firm set to occupy approximately 25,000 square feet (2,300 square metres) in the building from March this year. 

Also during this month Bloomberg reported that Point72 Asset Management has agreed to expand its footprint in The Henderson in Central to 85,000 square feet from 60,000 square feet, with the fund manager led by US financier Steve Cohen set to move into the trophy tower in May.

Kowloon Rises

While finance firms lock in leases in Central, the broader office market in Hong Kong continues to struggle, with vacancy climbing to 14.1 percent citywide at the end of December, from 14.0 percent a month earlier. 

In Wanchai and Causeway Bay districts vacancy jumped to 10.8 percent at the end of 2025 from 10.5 percent a month earlier, however, the area just east of Central saw office rents rise 0.4 percent from the end of November. 

Hong Kong East – home to Swire Properties’ Taikoo Place enclave – saw vacancy rise to 13.1 percent from 13.0 percent at the end of November. The area may receive a boost, however, from New World Development leasing a 20,400 square foot floor in its K11 Atelier King’s Road in Quarry Bay to creative agency The Marketing Store Worldwide (Asia) last month. 

Kowloon, which is often derided as “the Dark Side” by Hong Kong island denizens saw vacancy hold steady at 7.2 percent in Tsim Sha Tsui, while Kowloon East, a former industrial area which has struggled with a surplus of new projects in recent years, saw vacancy tighten to 19.4 percent from 19.7 percent at the end of November.