Hong Kong overall warehouse rents slip 1% in Q4 2022

Vacancy rates were stable at 1.9% during the quarter.

According to Savills, with Hong Kong closing its doors to the rest of the world during most of 2022 with strict quarantine controls, coupled with prolonged regional supply chain disruption, the first eleven months saw both local air freight and container throughputs decline by 15.4% and 6.9% respectively. 

Here's more from Savills:

International 3PLs, whose businesses were gradually recovering alongside global supply chains, had the ability to re-route their throughputs to other regional airports / ports, and were thus least affected by the situation in Hong Kong. 

Local 3PLs who are much more dependent on local supply chains and logistics operations, bore the brunt of the local market downturn, and many saw their 2021 profits wiped out and were thus forced into contraction mode. 

While 3PLs faced a tough time, end users focusing on daily necessities still saw business growth and expansion needs: Japan Home Centre relocated and took up 83,000 sq ft in ATL Logistics Centre for six years. 

With most operators struggling, landlords were more flexible in rental negotiations, leading to overall and modern warehouse rental declines of 1.0% and 1.5% in Q4/2022 respectively, while both overall and modern warehouse vacancy rates remained largely stable at 1.9% and 1.3% over the same quarter.