Hong Kong’s Central Sees Office Rebound as Decline Continues in Outlying Districts

Hong Kong’s recovering financial markets have rekindled office leasing demand in the city’s Central district, where rents began to inch upwards in recent weeks, at the same time that the outlook for the city’s secondary commercial hubs continues to look bleak, according to property analysts. 

Buoyed by demand from hedge funds and other finance firms, average leasing rates in prime buildings in Central district, the city’s traditional commercial hub, climbed 2.5 percent in the final weeks of 2025, according to Cushman & Wakefield, reversing a six-year slide. Analysts at the property consultancy tied rising rents in Central to a recovery in the city’s financial markets.

“The financial sector, buoyed by active IPO activity, drove leasing demand from both upstream and downstream industries, and accounted for over one-third of the new leased area in Q4,” said John Siu, managing director for Hong Kong at Cushman & Wakefield. “As a preferred submarket for banking and financial institutions, Greater Central rents also picked up during the quarter.”

That uptick in rents in Hong Kong’s core office hub during the final weeks of the year has come as rates in Kowloon East, Hong Kong East and Hong Kong South all fell by more than 1 percent since the end of September, continuing a decline in those secondary hubs which began in 2019, according to C&W research.

Top Properties Perform

Prime Central district properties achieved the biggest rental gains in Hong Kong’s office market in the fourth quarter, bringing rents in the area that includes finance hubs like Exchange Square, Jardine House and the IFC complex up 0.4 percent for the year to an average of HK$92 per square foot per month, according to Cushman & Wakefield.

In Greater Central, which includes the Admiralty and Sheung Wan areas, rents climbed 1.6 percent since September, but were still down 2.7 percent since the end of 2024, per the agency’s figures. Rents also rose 1.3 percent in Tsim Sha Tsui since the end of September, with West Kowloon, home to Sun Hung Kai’s upscale ICC complex and its new International Gateway Centre above the high speed rail terminus, also rising 0.4 percent in the period, although rents in both districts were still down for the full year. 

Rents in Hong Kong’s other major office hubs have continued to decline in the fourth quarter, with rates down 41.7 percent city-wide since their 2019 peak. Rents in Central declined 44.5 percent during that six-year period, while Tsim Sha Tsui tariffs fell 27.9 percent, according to figures from JLL. 

Finance Recovery Boosts Rents

The rebound in Greater Central office rents came as vacancy in the area fell to 14.8 percent through the end of November, from 16 percent two months earlier, according to C&W. 

During 2025, tenants took up a net 468,800 square feet of grade A space in Greater Central, as the city enjoyed its most active leasing period since 2019. 

The office leasing spree coincided with Hong Kong’s stock market returning to the top of global rankings with funds raised through IPOs on the HKEX jumping threefold from last year. 

As reported by Mingtiandi last week, London-based Qube Research and Trading has agreed to take up six floors tower two of the IFC complex, with the deal marking the second-largest office lease in the city’s Central district in the past decade. 

The largest Central deal of the past 10 years came in June, when quantitative trading firm Jane Street, a Qube competitor, agreed to lease 223,437 square feet in a Henderson Land project now known as Central Yards, which is located along the Central waterfront next to the IFC complex.

Also during 2025, quant trading firm Point72 agreed to lease 55,000 square feet at Henderson Land’s The Henderson in Central, with the company led by US fund manager Steve Cohen said to have upped that commitment later in the year to around 85,000 square feet. 

In October, IMC Group, a quantitative trader from the Netherlands, agreed to lease 16,900 square feet in Two IFC, according to Cushman & Wakefield.

Divergence to Continue in 2026

With the office market in Hong Kong’s top commercial hub having shown signs of recovery in recent weeks, rents are set to rise 3-5 percent in Greater Central during 2026, Cushman & Wakefield said. The agency also expects leasing rates to climb 1 to 3 percent in the Greater Tsim Sha Tsui area in Kowloon. 

Despite the encouraging signs in those areas, overall leasing rates for grade A offices in the city are expected to end 2026 at no more than 1 percent above current levels, with the potential to drop by 1 percent, per C&W’s research. 

That outlook is due to weak prospects for areas beyond Central and Tsim Sha Tsui, where leasing rates are expected to decline by 3 to 7 percent next year. 

While pointing to brighter prospects in Central, JLL predicts a further drop of up to 5 percent in city-wide office rents next year. 

“2026 is expected to be a year of divergence, where we can repurpose the adage that it is a ‘market of offices, not an office market’. The recovery will continue to be led by financial services firms, with Central’s office market benefiting most,” said Sam Gourlay, head of office leasing advisory at JLL in Hong Kong.