Hong Kong Grade A office absorption hits highest quarterly total since 2018

Net absorption reached over 690,000sq ft in Q3. 

According to a CBRE report, Hong Kong office leasing activity improved with gross leasing volume increasing 25% q-o-q to 1.3 million sq. ft., bringing the y-t-d volume to 3.2 million sq. ft., marking a decline of 12% y-o-y and accounting for 73% of the full-year figure for 2024.

“Citywide net absorption reached 691,800 sq. ft., the highest quarterly total since Q3 2018. All major submarkets saw positive net absorption; the first time this has occurred since Q2 2015,” the report noted. According to a CBRE report, Hong Kong office leasing activity improved with gross leasing volume increasing 25% q-o-q to 1.3 million sq. ft., bringing the y-t-d volume to 3.2 million sq. ft., marking a decline of 12% y-o-y and accounting for 73% of the full-year figure for 2024.

Here’s more from CBRE:

Central reported 138,000 sq. ft. of the net absorption, the highest since Q2 2015, with only nine buildings recording a decline in occupancy. In contrast, Hong Kong East recorded 25,500 sq. ft., the lowest net absorption of any major submarket. Although both Hong Kong East and Kowloon East saw positive net absorption this quarter, their YTD figures remain negative.

Positive net absorption helped offset the 409,600 sq. ft. of unleased space added by a new building. This ensured vacancy fell 0.3-ppt to 17.1%, the largest quarterly decline since Q3 2018.

Vacancy remained high and contributed to a 0.7% q-o-q drop in rents, bringing the y-t-d decline to -3.4%. All major submarkets reported rental declines this quarter, except for Greater Tsim Sha Tsui.

Ada Fung, Executive Director, Head of Leasing & Consulting, CBRE Hong Kong: “Hong Kong’s Grade A office market continued its recovery in Q3 2025, with leasing momentum strengthening across all major submarkets. Notably, this quarter marked the first time since Q2 2015 that every submarket saw positive net absorption. Central led the way with 138,000 sq. ft. of net absorption, the highest quarterly figure in a decade, as occupiers took advantage of attractive rental levels to upgrade or relocate. While some tenants remain cautious due to elevated vacancy rates, particularly in decentralised areas, the market is gradually recalibrating.”