East Kowloon still low water rent performance is expected to be stable
The trade war between China and the United States has continued. The business environment in Hong Kong has been affected. The Chinese institutions have been temporarily suspended in Central. It is expected that rents will fall. East Kowloon is still cheaper and the rental performance is relatively stable.
The rental market reflects the overall economic outlook
The overall commercial rental activity was not active this year, and the rents of commercial buildings in various districts have also been adjusted. According to the data from the Knight Frank, the best quality of the property rental in Central was smashed to $200 last year. The latest rent was $189.7, down 1.8% month-on-month. In the Golden Bell, Sheung Wan, Causeway Bay and Kowloon East, the rents were all down.
The commercial rental market can reflect the overall economic activities. If the economy is good and the business environment is ideal, foreign and local institutions will expand their business. On the contrary, the current situation is uncertain. The organization will be cautious and may reduce the rental of flats. It will also look for new tenants to rent, or move the office to a cheaper area to save money.
Central District rents topped down, expected to adjust 5%
Sino-US trade frictions have been close to one year. For business people, it is indeed an uncertain factor. In particular, trade-related industries, such as procurement and shipping, have the opportunity to be affected by trade wars and cause business to decline. There are individual institutions that are bearish on the prospects and have scaled down and even closed down. The impact of the commercial market is the slowdown of the organization, the reduction of office rents and the pressure on rent.
In the past month, rents in the Central District have fallen. In fact, since the middle of last year, more or less affected by the trade war, Chinese-funded institutions have reduced their expansion in the Central District. In the past, Chinese capital has to go out in the national policy and set up a base in Hong Kong. Most of them are located in the central area of the core area, pushing up the rent to a historical high.
Under the trade war, the pace of expansion of Chinese-funded institutions has slowed markedly. Even financial institutions are seeking to rent out Central and Admiralty office buildings. The slowdown in rentals has caused rents to peak, and it is expected to adjust by about 5% this year.
In Kowloon, the new supply in East Kowloon is much higher than that in Hong Kong Island. The rent in the district is cheaper. It can attract tenants to relocate to save rent. The rental performance is expected to be stable.