Prices of Hong Kong Grade A Office Space To Increase In Third Quarter Of 2009
Prices for Grade A offices in Hong Kong property market are expected to increase in the third quarter of 2009 due to sufficient fund inflow.
However property experts expect rents, particularly those in the CBD, will go down further due to poor demand and because of constant relocation of firms to cheap areas.
The figures of the sales and leasing markets have been moving away from each other in the last few months. Property experts consider that there are added end-users and wealthy investors with ready cash in hand, both in the vicinity and from the mainland, returning to the market in search of investment prospects.
Sustained by a well-built stock market rally and low interest rates, investors have required substitute asset classes for enhanced returns in past few months. They have chosen low earnings and immediate profits over having their money sit in bank deposits that make available almost-zero interest rates. Hong Kong's property market will keep on saying goodbye, determined by these forces.
According to the leading property consultancy CB Richard Ellis, the standard price for Grade A offices increased by 15.5% to an average of HK$11,167 per square feet as at June from January. On the other hand, the leasing market was in under pressure as businesses sustained to reduce cost, motivating rents down by 19% to HK$42.76 per square feet in the same period.
Rents in the CBD dropped to HK$77 per square feet at June, losing 27% from January.
The executive director for office services at CB Richard Ellis, considers rents may go down further in the near future as more and more firms may move to cheaper space in the Kowloon decentralized markets, which are more out from Central.
However property experts expect rents, particularly those in the CBD, will go down further due to poor demand and because of constant relocation of firms to cheap areas.
The figures of the sales and leasing markets have been moving away from each other in the last few months. Property experts consider that there are added end-users and wealthy investors with ready cash in hand, both in the vicinity and from the mainland, returning to the market in search of investment prospects.
Sustained by a well-built stock market rally and low interest rates, investors have required substitute asset classes for enhanced returns in past few months. They have chosen low earnings and immediate profits over having their money sit in bank deposits that make available almost-zero interest rates. Hong Kong's property market will keep on saying goodbye, determined by these forces.
According to the leading property consultancy CB Richard Ellis, the standard price for Grade A offices increased by 15.5% to an average of HK$11,167 per square feet as at June from January. On the other hand, the leasing market was in under pressure as businesses sustained to reduce cost, motivating rents down by 19% to HK$42.76 per square feet in the same period.
Rents in the CBD dropped to HK$77 per square feet at June, losing 27% from January.
The executive director for office services at CB Richard Ellis, considers rents may go down further in the near future as more and more firms may move to cheaper space in the Kowloon decentralized markets, which are more out from Central.
Labels: Grade A offices, leading property consultancy, rents
Posted by Moveandstay
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