OFFICE RENTAL HONG KONG
Next Level Office Rental Experts
Office Rental Hong Kong
ORHK presents a streamlined approach to sourcing, negotiating & booking furnished office spaces.
-
Grow with ORHK. Deal with office rental experts and have a dedicated account manager to handle your business infrastructure needs throughout your business lifecycle. We support businesses with 1 headcount to multi-national corporations.
-
The ORHK team of experts has dealt with a large volume of transactions with landlords and vendors in Hong Kong, and thus, engaging providers through ORHK provides you with natural leverage and save you time, money and rewards to enjoy. Enquire now on the SOHK Concierge form for your iPhone reward eligibility.
-
Fees payable by the client are absorbed by vendors in Hong Kong. There is no fee required by engaging ORHK.
FEATURED OFFICES FOR RENT
Office Rental Hong Kong
OCT 2023 | LAST UPDATED
Welcome to the Ultimate Office Rental Hong Kong Platform
Hong Kong is a global financial hub, and as such, it offers a wide range of office spaces that cater to different types of businesses. Whether you're an SME or a larger corporate or MNC, there are plenty of options to choose from when it comes to renting an office in Hong Kong. In this guide, we'll take a detailed look at the infrastructure, amenities, and other factors that are relevant to the Hong Kong market, and help you find the perfect office space for your needs.
Location
When it comes to renting an office space in Hong Kong, location is one of the most important factors to consider. Hong Kong has a number of business districts, each with its own unique advantages. Central is the most established business district and is home to some of the world's largest financial institutions. Sheung Wan, Admiralty, Causeway Bay are also popular locations, with easy access to public transportation and a wide range of amenities.
Infrastructure
Hong Kong's office space infrastructure is world-class, with modern buildings and state-of-the-art facilities. Most office spaces in Hong Kong come with air conditioning, lighting, and internet connectivity as standard. Some buildings also offer additional amenities such as 24-hour security, concierge services, and meeting rooms.
The Hong Kong office market categorizes office spaces into different grades based on their quality, regardless of location.
Generally, Grade A is the highest category, followed by Grade B and Grade C. Although there are no strict guidelines that dictate which “Grade” an office premise belongs to, the industry typically classifies Grade A office buildings into three quality tiers: Grade A, Grade AA, and Grade AAA. These Grade A offices are considered the standard for excellence in terms of specification.
Office Types
When it comes to office types, there are several options available in Hong Kong.
Traditional office spaces are the most common and come in a range of sizes to cater to different business needs.
Serviced offices / co-working spaces are also becoming increasingly popular, particularly among startups and SMEs. These offer a more flexible approach to office rental, with a range of packages available to suit different budgets.
Can not choose? Read our guide for Read our Serviced Office vs Traditional Office Space guide
Amenities
Amenities are an important consideration when renting an office space in Hong Kong. Most buildings offer a range of amenities such as cafes, restaurants, and fitness centers. Some buildings also have rooftop gardens and outdoor spaces, which can be a great place to relax and unwind after a long day at work.
4 Step Hong Kong Office Rental Guideline
1. Location Preference
When choosing an office location in Hong Kong, it's important to consider how it will impact your operational efficiency and perception within the business community. The location can also have an effect on staff retention and productivity. Reviewing sector-specific information on the Hong Kong office rental market can help you make informed decisions about location. It's also essential to take into account the demographics of your staff, ensuring that the office is easily accessible. Moreover, the availability of amenities and supporting facilities can help reduce downtime and boost productivity. Read more about office for rent by locations with SAVVI.
2. Space Requirements
Determining the right amount of office space is crucial for the productivity and comfort of your employees. Consider the number of employees and the intended use of the space, as well as your growth expectations over the lease term. If flexibility is needed, serviced office options can be explored. Moreover, indicative "test-fit" plans of each short-listed office can illustrate how the space can be configured to meet your needs and provide an accurate estimate of the cost of works. Learn more about Design & Build with SAVVI, and utilise the space calculator.
3. Timing
Setting up an office in Hong Kong can be a complex process, especially for companies coming from abroad. It's important to understand the prerequisites that need to be considered before committing to an office, including visas, home searches, and international schooling. Depending on the size of your business and the type of accommodation required, the time required to set up an office in Hong Kong typically ranges from two weeks to six months.
When considering an office in Hong Kong, it's important for businesses to have a clear understanding of their medium-term growth plans and location preferences.
Temporary offices, such as co-working spaces or serviced offices, can offer immediate occupation solutions and are readily available throughout Hong Kong. These providers offer a range of office sizes, from one-person spaces to larger spaces for up to 200+ people. Additionally, they often provide shared services such as meeting rooms, reception areas, server rooms, and breakout facilities. This option provides greater flexibility for those companies looking to set up quickly, require a short-term commitment, and want to limit capital expenditure. Typically, commitments last 3-12 months and are documented by way of a "Service Agreement" signed by both the provider and the occupier.
4. Financial Budget
Office rents in Central, Hong Kong, are among the highest in the world. Setting a realistic budget as soon as possible is crucial. Working within your locational preference and budget, you can set parameters for your office search. Additionally, it's important to manage costs throughout the process and to exercise caution when comparing a list of properties for financial analysis, as landlords are not required to quote areas in a standardized form. To learn more, refer to the How to Rent Office Space guide by SAVVI.
Hong Kong Office Location Spotlight
-
Central is the most established business district in Hong Kong and is home to some of the world's largest financial institutions. It has excellent transportation links, with several MTR stations and bus routes, making it easy for employees to commute to and from work. Central also has a range of amenities, including shopping centers, restaurants, and bars.
-
Admiralty is a popular location for multinational companies and is home to several major banks and financial institutions. It has excellent transportation links and is connected to Central via a series of walkways and escalators. Admiralty also has a range of amenities, including shopping centers, restaurants, and bars.
-
Wan Chai is a popular location for startups and SMEs and is home to a number of co-working spaces. It has good transportation links and is connected to Admiralty via a series of walkways and escalators. Wan Chai also has a range of amenities, including shopping centers, restaurants, and bars.
-
Causeway Bay is a bustling shopping and commercial district in Hong Kong. It has excellent transportation links, with several MTR stations and bus routes. Causeway Bay is popular among retailers, but also has office spaces available for rent.
-
Tsim Sha Tsui is a popular location for businesses looking to establish a presence in Kowloon. It has excellent transportation links, with several MTR stations and bus routes, and is close to the cross-harbour tunnel. Tsim Sha Tsui is home to several major hotels and has a range of amenities, including shopping centers, restaurants, and bars.
-
Quarry Bay is a popular location for businesses in the creative industries, with several media and advertising companies based in the area. It has good transportation links, with several MTR stations and bus routes, and is home to several co-working spaces.
-
Kwun Tong is a growing business district in Kowloon, with several new office developments currently under construction. It has good transportation links, with several MTR stations and bus routes, and is home to several technology and innovation companies.
-
Cyberport is a technology-focused business park located on the south side of Hong Kong Island. It has excellent transportation links, with a dedicated MTR station, and is home to several technology and innovation companies. Cyberport also has a range of amenities, including a fitness center, restaurants, and a cinema.
Office Rental Pricing
Hong Kong Q2 2023 Net Effective Rents
(Access Real Time Hong Kong Office Rentals by SAVVI)
Market Analysis & Research
-
The office leasing market in Hong Kong remained weak in Q4 2022, with gross leasing volume declining by 22.1% q-o-q to 732,800 sq. ft. and full-year leasing volume declining by 10.6% y-o-y to 3.8 million sq. ft. This was due to economic headwinds at the global level.
Net absorption returned to positive territory this quarter, largely driven by pre-commitments to new buildings in Kowloon East. For the full-year, net absorption was 601,100 sq. ft., driven by relocation demand.
Despite the highest level of new supply since 2008, at 4.1 million sq. ft., commitments were low, leading to a record high vacant space of 13.0 million sq. ft. and a vacancy rate of 15.1%.
Overall rents fell by 1.6% q-o-q, bringing the full-year decline to 3.7% y-o-y. The economic backdrop was volatile, with Hong Kong's real GDP shrinking by 4.5% y-o-y in Q3 2022.
Industry Commentary:
According to JLL's Hong Kong Office Property Market Monitor Q4 2022 report, the overall vacancy rate in Hong Kong's Grade A office market decreased by 1.7 percentage points q-o-q to 7.8%, and net absorption increased to 215,400 sq ft, the highest level since Q4 2019. The report also indicates that rents for Grade A office spaces rose by 2.3% q-o-q, reflecting the continued improvement in demand from occupiers.
CBRE's Hong Kong Office MarketView Q4 2022 report also indicates an upward trend in the rental market, with a 0.5% q-o-q rental growth rate for Grade A office spaces, despite the ongoing uncertainties in the global economy. The report also highlights that the overall vacancy rate for Grade A office spaces in Hong Kong dropped to 6.8% in Q4 2022, the lowest level since Q2 2018.
Savills' Hong Kong Office Market Report Q4 2022 also highlights the improving conditions in Hong Kong's office rental market, with a 2.1% q-o-q rental growth rate for Grade A office spaces. The report also notes the continued demand for high-quality office spaces, especially from the financial and professional services sectors.
Colliers' Hong Kong Property Market Monitor Q4 2022 report also highlights the robust performance of Hong Kong's office leasing market, with a 1.4% q-o-q rental growth rate for Grade A office spaces in Q4 2022. The report also states that the overall vacancy rate for Grade A office spaces in Hong Kong dropped to 6.3% in Q4 2022, the lowest level since Q3 2018.
Knight Frank's Hong Kong Office Property Market Update Q4 2022 report indicates that the overall vacancy rate for Grade A office spaces in Hong Kong decreased to 7.2%, and rents for Grade A office spaces increased by 1.8% q-o-q in Q4 2022. The report also highlights the steady demand for Grade A office spaces, with several large deals recorded during the quarter. -
Vacancy
Q4 2022 saw the highest level of new office space since 2008, resulting in a total of 4.1 million sq. ft.
High supply and limited demand led to a new record high of 13.0 million sq. ft. in overall vacancy, up by 719,300 sq. ft.
Overall vacancy rose to 15.1% by year's end, surpassing the 14.4% recorded in 1999.Most submarkets experienced an increase in vacancy this quarter, with Kowloon East seeing the sharpest rise of 2.2-ppt to 22.4%.
Hong Kong East was the only submarket where the vacancy rate fell this quarter, down 0.4-ppt to 13.2%.
Rents
Overall rents fell by 1.6% q-o-q in Q4 2022, the sharpest decline since Q3 2021.
All key submarkets recorded a drop in rents this quarter, with Wan Chai/Causeway Bay experiencing the largest decline of 14% q-o-q.
Hong Kong East was the weakest submarket in 2022, with an annual rental decline of -6.5%.
Greater Central saw the largest decline in rents of 2.2% q-o-q, while Hong Kong East saw the weakest decline of 0.6% q-o-q.
Greater Tsim Sha Tsui logged the sharpest rental decline this quarter, down 2.0% q-o-q and brought the full-year decline to 3.6%.
-
Amid global economic headwinds, Q4 2022 witnessed sluggish leasing momentum with a decline of 22.1% q-o-q to 732,800 sq. ft., marking the lowest quarterly volume since Q1 2021. The total volume of leasing for the year stood at 3.8 million sq. ft., a 10.6% y-o-y decline. The banking and finance sector accounted for 40% of leasing volume, with UBS pre-leasing 187,500 sq. ft. (250,000 sq. ft. gross) at the upcoming XRL Terminus commercial project in West Kowloon for office consolidation, marking the largest leasing transaction so far in the decade.
Newly completed buildings saw positive net absorption at 76,000 sq. ft. this quarter, down from 329,800 sq. ft. in Q3 2022. Net absorption was positive for two consecutive quarters, totaling 601,100 sq. ft. for the year, the first positive annual figure in three years.
In Greater Central, net absorption turned negative at -51,500 sq. ft. after logging 33,700 sq. ft. in Q3 2022, resulting in a total of -153,100 sq. ft. for the year. Sotheby's pre-leased 27,300 sq. ft. in the Six Pacific Place development, marking the largest transaction on Hong Kong Island, but did not drive net absorption in the secondary market.
Hong Kong East and Kowloon East were the only two submarkets to register positive net absorption this quarter. Hong Kong East's net absorption grew by 43,100 sq. ft., the strongest submarket of 2022, bringing the total to 264,200 sq. ft. Competitive leasing terms attracted tenants to relocate within the district, such as Interlux, which leased two floors totalling 25,500 sq. ft. in Dorset House, relocating from 633 King's Road. China Road & Bridge Corporation also leased a whole floor in Dorset House, expanding from K Wah Centre.
Kowloon East registered positive net absorption of 150,400 sq. ft., making it the best performing submarket of the quarter, primarily due to the completion of The Millennity in Kwun Tong. Airside in Kai Tak remained attractive, with two firms each taking up a whole floor.
Demand remained weak in Tsim Sha Tsui and Wan Chai/Causeway Bay, resulting in -14,200 sq. ft. and -57,600 sq. ft. of net absorption, respectively, in Q4 2022. Together with Greater Central, the core submarkets witnessed negative full-year net absorption of -339,800 sq. ft. -
The office rental market in Hong Kong is influenced by various trends, including the shift towards flexible workspaces, increased demand for coworking spaces, and the impact of the COVID-19 pandemic.
The demand for flexible workspaces, which provide short-term leasing options, has been on the rise, especially among startups and small businesses.
Coworking spaces have also gained popularity, with major players such as WeWork and The Executive Centre expanding their presence in Hong Kong. The COVID-19 pandemic has accelerated the adoption of remote work, and many companies are now rethinking their office space requirements, leading to a shift towards smaller, more flexible spaces. -
Although Hong Kong's business activity has largely returned to normal, multinationals are expected to remain cautious due to global economic headwinds and higher financing costs in 2023. However, with the reopening of mainland China to the world, office demand from Chinese enterprises is expected to return to Hong Kong, with Greater Central and Wan Chai likely to benefit the most.
Demand for wealth management services in Hong Kong is expected to increase due to travel normalisation and government policy support. Whole-floor premises for prestige lounges for traditional banks and smaller units for boutique wealth management firms and family offices are likely to be in high demand.Co-working centers will continue to be a popular growth option for smaller partnerships and financial and investment start-up companies.
Non-traditional occupiers such as healthcare centers and art galleries are expected to become increasingly sought-after by office landlords, although they may have more stringent building specification requirements.
In 2023, 2.7 million sq. ft. of pipeline supply is expected to come on stream, providing more options to occupiers seeking flight-to-quality moves. 80% of this new supply is in decentralised areas, offering premium building quality at lower rents compared to traditional submarkets.Decentralisation demand is therefore expected to recover in 2023.
Upgrading demand will also be met by new CBD supply, with two new Grade A1 buildings totaling around 800,000 sq. ft. net due for completion in Q3 2023. However, amid rigid cost controls and upward pressure on vacancy, rents are expected to decline by a further 0%-5% in 2023 in major submarkets given the prevailing supply cycle, until demand is strong enough to reverse the trend. -
The office rental market in Hong Kong is highly competitive, with many local and international players. The major landlords and developers include Sun Hung Kai Properties, Swire Properties, Henderson Land Development, and Hong Kong Land. Other players include New World Development, Wheelock Properties, and Wharf Real Estate Investment Company. These companies offer a wide range of office spaces, from Grade A to Grade B and C, in various locations across Hong Kong.
Types of Office Property Ownership in Hong Kong
Office properties in Hong Kong can be owned in different ways, including by Portfolio Landlords, Single Ownership, and Strata-Title.
Portfolio Landlords often own clusters of buildings with a mix of retail and commercial spaces. They are usually involved in property development and manage the building in-house.
Single Ownership properties are typically owned by private investors, institutions, or large organizations. They often hire a third-party specialist to manage the property.
Strata-Title properties have multiple landlords who own office suites or floors in a building. The property's communal areas, including the exterior, are managed by an external company. Although acquiring space in a strata-title property is similar to other commercial spaces, expansion plans may be challenging due to sale and redevelopment clauses.