News release

Office market mainly driven by upgrading demand

Overall rents drop 0.3% in April

May 23, 2023

Yvonne Liu

+852 2846 5264

HONG KONG, May 23, 2023 – Hong Kong's Grade A office market is mainly driven by upgrading demand following more new office completions this year, according to JLL's latest Hong Kong Property Market Monitor released today.

The market sentiment continued to improve amid the border reopening and economic recovery. Among a handful of new lettings, Doo Group leased an entire floor with a gross floor area of 12,600 sq ft at The Millennity in Kwun Tong to upgrade and consolidate its offices within the same district.

Alex Barnes, Managing Director at JLL in Hong Kong, said: "There will be around 3.2 million sq ft of new Grade A office space scheduled for completion this year which would inevitably drive the vacancy rate up, however, the new completions are attracting tenants to relocate and upgrade their offices. Tenants are viewing it as an opportune time to upgrade on the back of more choices, variety of floor plate sizes, and the latest green and technological facilities."

The overall office market recorded a negative net absorption of 245,100 sq ft in April, due to the return of some sizable spaces to the market during the month. The overall vacancy rate rose marginally to 12.3% at the end of April, with Central's vacancy rate remaining flat.

Overall net effective rents dropped by 0.3% m-o-m in April. Among the major office submarkets, rentals in Central and Kowloon East dropped by 0.5%, while Tsimshatsui's rent rose marginally by 0.3%.

In terms of the retail market, Cathie Chung, Senior Director of Research at JLL, said: "Retail leasing activities accelerated in high streets in core locations following the return of tourists, with committed leases mostly on the standard two- to three-year terms, compared to the short-term leases prevalent during COVID, and the strengthening leasing market has helped to improve the retail investment market sentiment."

Grade A Office Vacancy
Period Overall Central Wanchai/Causeway Bay Hong Kong East Tsimshatsui Kowloon East
End-April 23 12.3% 9.0% 9.9% 12.6% 10.9% 19.5%
End-Mar 23 12.0% 9.0% 9.6% 11.2% 11.0% 19.3%

Source: JLL Research

About JLL

For over 200 years, JLL (NYSE: JLL), a leading global commercial real estate and investment management company, has helped clients buy, build, occupy, manage and invest in a variety of commercial, industrial, hotel, residential and retail properties. A Fortune 500® company with annual revenue of $20.8 billion and operations in over 80 countries around the world, our more than 106,000 employees bring the power of a global platform combined with local expertise. Driven by our purpose to shape the future of real estate for a better world, we help our clients, people and communities SEE A BRIGHTER WAYSM. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit