Hong Kong Island Grade A office rents to decline by up to 3% in 2025

There is only one project scheduled for completion in the second  half of the year.

In the first half of 2025, the Hong Kong Island office market was characterised by some turbulence due to the uncertainty surrounding the global trade war. However, Wendy Lau, Executive Director and Head of Hong Kong Office Strategy & Solutions at Knight Frank, said the impact of US tariffs on the office landscape in Hong Kong Island has been limited, thanks to the tenant mix and the ease of the situation. 

"The market movement continues to rely heavily on the economic revival of both Hong Kong and Chinese mainland businesses to generate more organic growth," Lau said.

Here’s more from Knight Frank:

Despite the uncertain impact of the US tariffs on office leasing sentiments in Hong Kong Island, the market remains cautious of sudden changes and delayed impacts. Office leasing demand is gradually increasing, primarily driven by the finance sector and PRC companies. Moreover, future supply in Hong Kong Island will continue to be a significant concern for both rental trajectory and occupancy forecasts.

Office rents across all districts are expected to remain downward-oriented, while offices in Wan Chai exhibited greater resilience. The office vacancy rate in Causeway Bay has dropped, and landlords have also noted that while rents from renewals are still declining, the rate of decline has narrowed compared to 2024. 

We believe the market may remain static, as there is only one major development scheduled for completion – One Causeway Bay in the second half of 2025 in Hong Kong Island. We expect Grade-A office rents on Hong Kong Island to drop by 0% to 3% in 2025.