Grade A office rents on Hong Kong Island to decline by up to 5% in 2026

On the other hand, premium office rents in Central may grow by up to 8%.

Hong Kong Island’s Grade-A office leasing market remains subdued, with rents continuing to decline and vacancy rates staying elevated, reflecting ongoing economic uncertainty, according to Knight Frank.

Wendy Lau, Executive Director and Head of Hong Kong Office Strategy & Solutions at Knight Frank, said, “The Grade-A office leasing market on Hong Kong Island remains subdued, with only a slight improvement in demand. Occupiers are taking a cautious approach in their leasing decisions amid persistent economic concerns.”

Knight Frank highlighted that premium buildings in Central are showing early signs of recovery, with rental growth returning to positive territory. However, traditional Central office buildings continue to face downward pressure, while some districts such as Causeway Bay and Quarry Bay have underperformed, Lau noted. Leasing demand is currently being led by the finance sector and PRC enterprises, which remain active tenants in the market.

Looking ahead, Lau said that future office supply on Hong Kong Island will continue to be a critical factor affecting both rents and occupancy levels. “Larger occupiers are poised to expand, capitalising on flight-to-quality trends and the rare availability of large, distinctive floorplates. Meanwhile, PRC companies continue to generate robust demand,” she explained. Lau added that occupiers are increasingly seeking flexible lease terms and are placing more emphasis on in-house amenities and functional spaces.

Knight Frank’s forecast for the market in 2026 reflects this mixed outlook. Lau projected that Grade-A office rents on Hong Kong Island are expected to decline by 0% to 5%, while premium Central offices may record positive rental growth of up to 8%, supported by the limited availability of high-quality spaces.

“While challenges persist, there are also clear opportunities for landlords and occupiers who focus on quality, functionality, and flexible leasing structures,” Lau said.