Two deals that stood out in Hong Kong’s industrial leasing market

One is a relocation to 88,000 sq ft of space in Tsuen Wan.

Hong Kong’s warehouse leasing market began to feel the heat of ongoing external uncertainties and persistent supply chain disruptions. According to Savills, many operators are opting for renewal rather than relocation, and very few logistics players, except e-commerce operators, are in expansion mode. 

Here’s more from Savills:

In a quiet market some deals stood out. DON DON DONKI relocated from Goodman Kwai Chung Logistics Centre to take up around 88,000 sq ft on LG and UG/F of Goodman Dynamic Centre (an expansion of around 30,000 sq ft) in Tsuen Wan. HKTV Mall meanwhile expanded to take up another floor (around 144,000 sq ft) in Mapletree Logistics Hub Tsing Yi. 

Overall warehouse vacancy rebounded to 2.1% in Q3, while modern warehouses also saw availability bouncing back to 1.4% of total stock. 

As logistics demand dwindled, overall and modern warehouse rents registered 0.8% and -0.1% growth in Q3/2022 respectively, while both overall and modern warehouse vacancy rates rebounded slightly to 2.1% and 1.4% over the same quarter. In general landlords were eager to maintain occupancy rather than achieve above-average market rents.