Office rents in Kowloon to rise by up to 3% in 2023

The overall market seems to have bottomed out.

According to a recent report by Knight Frank, the office vacancy rate in Kowloon climbed to 7.5% but a mild decrease was recorded in Kowloon Central. 

“Office demand is resuming with sizable transactions recorded in the second half of 2022. Electronic and sourcing companies remained a major driver,” the report added.

Here’s more from Knight Frank:

Flight-to-quality remained an occupied priority. Apart from quality, office demand is affected by other factors, such as workplace strategy, as a rising number of companies adopt work-from-home, hot desking and agile working. Meanwhile, ESG is becoming a key requirement for modern corporates. Buildings with ESG green features are more appealing to tenants and more likely to stand out from other competitors in the market.

The overall office market in Kowloon saw signs of bottoming out. When the border with Chinese mainland reopens, we expect Chinese mainland and MNC tenants to return and the overall Kowloon office rents to slightly increase by 0 to 3% in 2023.