Hong Kong owner-occupiers target discounted office deals
SCMP · 1 SOURCESabout 1 hour ago2 MIN
Summary
Hong Kong’s noncore office market remains under pressure from high vacancy rates and soft investor appetite, yet selected owner-occupiers are using the downturn to secure office space at discounted prices. The latest example is the Estate Agents Authority’s agreement to buy a unit in Wan Chai for HK$70 million, ahead of moving out of its leased office around the middle of next year.
Key Points
- Land Registry records show the Estate Agents Authority agreed earlier this month to buy a 7,343 sq ft office in the OTB Building, Wan Chai, for HK$70 million .
- The deal worked out to HK$9,533 per square foot, below HK$10,000 and lower than the building’s previous recorded 2019 transaction at HK$11,839 per square foot .
- Ricacorp Properties’ Marcus Chu said the sale showed buying support at current price levels, though limited transactions in the building may have helped prices hold up .
- Overall noncore office values have fallen by more than half from their 2018 peak, while some districts are recording vacancy rates of about 30 per cent, according to market data cited in the report .
- The Estate Agents Authority said the Wan Chai purchase would replace its leased Hopewell Centre office when that lease expires around mid-2026, reducing rental spending and improving financial stability .
Why It Matters
For Hong Kong businesses and public bodies that plan to occupy their own premises, the current market is opening a rare window to buy offices at prices far below past peaks . Continued price cuts by developers, distressed asset sales and tight bank financing mean the recovery path for noncore offices is still likely to depend more on end-users than investors .