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Monday, 12 February 2018, 20:00 HKT/SGT
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Source: RICS
The capital value and rent in secondary office space receives a boost by the decentralisation of foreign financial sector

HONG KONG, Feb 12, 2018 - (Media OutReach) - The RICS (Royal Institution of Chartered Surveyors) Hong Kong Commercial Property Monitor Q4 2017 indicated a continued increase in sentiment for the occupier and investor markets. The Occupier Sentiment Index (OSI) climbed three points from the previous quarter, to ten. The Investor Sentiment Index (ISI) increased modestly from 12 in Q3 to 13 in Q4.

Demand continued to rise in the occupier market while the headline net balance remained at 22 per cent in Q4. The office, industrial, retail market segments remained relatively unchanged from Q3. Survey respondents continued to report an increase in the supply of office and retail properties available to let, but the availability of office properties declined.

In the investment market, headline investor demand remains robust, as a net balance of 26 per cent of respondents reported an increase, up from 22 per cent in the previous quarter. Demand for office and industrial space continued to increase at a firm pace, while demand for retail properties was unchanged. The supply of office and retail properties and office development starts were reported to have increased during Q4.

"The strong demand for Grade A office space is largely driven by mainland China's investment and finance sector companies that are actively expanding their businesses in Hong Kong," said RICS Surveyor Mr Frank F Wong MRICS. "Hong Kong provides a financial hub as a leading IPO fundraising centre and continues to be recognised as world's freest economy.

"Many foreign financial banking intuitions are relocating their operations from Central to Hong Kong East and Kowloon East. As firms are displaced from prime locations, demand for secondary office space receives a boost, resulting in an increase in capital value and rent support," Mr Wong said.

Respondents were more bullish on the one-year outlook for capital values, with the headline forecast being revised up to 3.3 per cent in Q4 from 1.8 per cent in Q3. Headline rents are expected to increase 2.6 per cent over the next year, up from 1.5 per cent in the previous quarter.

The RICS Hong Kong Commercial Property Monitor is a quarterly sentiment index tracking trends in the commercial property market. It is a leading indicator for global investment and occupier markets. The full report is available at www.rics.org/economics.

About RICS

Confidence through Professional Standards

RICS promotes and enforces the highest professional qualifications and standards in the development and management of land, real estate, construction and infrastructure. Our name promises the consistent delivery of standards - bringing confidence to the markets we serve.

We accredit 125,000 professionals and any individual or firm registered with RICS is subject to our quality assurance. Their expertise covers property, asset valuation, real estate management; the development of infrastructure; and the management of natural resources, such as mining, farms and woodland. From environmental assessments and building controls to negotiating land rights in an emerging economy; if our members are involved the same professional standards and ethics apply.

We believe that standards underpin effective markets. With up to seventy per cent of the world's wealth bound up in land and real estate, our sector is vital to economic development, helping to support stable, sustainable investment and growth around the globe.

With offices covering the major political and financial centres of the world, our market presence means we are ideally placed to influence policy and embed professional standards. We work at a cross-governmental level, delivering international standards that will support a safe and vibrant marketplace in land, real estate, construction and infrastructure, for the benefit of all.

We are proud of our reputation and work hard to protect it, so clients who work with an RICS professional can have confidence in the quality and ethics of the services they receive.

Media enquiry, please contact:
RICS East Asia Public Relations Representatives
Ms Peggy Mak / Ms Penn Leung
T: +852 3159 2982 / +852 3159 2986
E: [email protected] / [email protected]


Feb 12, 2018 20:00 HKT/SGT
Topic: Press release summary

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