3
DECENTRALIZATION DRIVEN BY FLIGHT-TO-QUALITY AND COST CONSIDERATIONS
Greater Central
Average building age
Hong Kong East
As of Q2 2020, the average age of office buildings in Hong Kong’s three core sub-markets was 29 years. With many office schemes in the development pipeline expected to have higher building specifications and larger floorplates, flight-to-quality is set to remain a key trend.
Amongst decentralised locations, Hong Kong East is expected to attract Hong Kong Island-based occupiers seeking flight-to-quality relocations to attractively priced, new and high-quality premium Grade A buildings located just a few MTR stations away from the Central CBD.
Kowloon East
Wong Chuk Hang
29 Years
20 Years
11 Years
9 Years
Cost Considerations
In pursuit of quality
Wan Chai/Causeway Bay
Tsim Sha Tsui
26 Years
32 Years
3
DECENTRALIZATION DRIVEN BY FLIGHT-TO-QUALITY AND COST CONSIDERATIONS
Cost Considerations
Hong Kong East
Rental Savings per sq. ft. per minute travel from Central
Travel Time from Central by MTR
Wong Chuk Hang
15 mins
14 mins
30 mins
4.2
6.1
2.8
Kowloon
East
In pursuit of quality
Older CBD buildings owned by Hong Kong’s leading portfolio landlords are typically well-maintained and therefore continue to attract robust occupier demand. However, new and high-specification properties in decentralised locations such as Hong Kong East and Kowloon East offer significant discounts on CBD rents, making them highly attractive to occupiers seeking to upgrade their office premises whilst keeping occupancy costs under control.
55%
3
DECENTRALIZATION DRIVEN BY FLIGHT-TO-QUALITY AND COST CONSIDERATIONS
Core
HKD$78.0
discount on average
Non-Core
HKD$34.9
per sq. ft. per. month
Cost Considerations
In pursuit of quality
Older CBD buildings owned by Hong Kong’s leading portfolio landlords are typically well-maintained and therefore continue to attract robust occupier demand. However, new and high-specification properties in decentralised locations such as Hong Kong East and Kowloon East offer significant discounts on CBD rents, making them highly attractive to occupiers seeking to upgrade their office premises whilst keeping occupancy costs under control.