Hong Kong commercial real estate is showing signs of life again. The move by Swiss bank UBS
to West Kowloon and trading firm Jane Street’s
leasing of 223,000 sq ft of office space at the New Central Harbourfront project – the largest leasing deal in Central in a decade – have given a big boost to the market. Such moves by foreign financial institutions not only indicate market recovery, but also their confidence in the Hong Kong and mainland economies, with the city playing the role of a financial “superconductor”.
The long-battered office sector showed a
marked improvement last year with higher take-up rates in core districts and slowing rental declines. That momentum is expected to continue this year. The city’s office market is transforming with West Kowloon becoming an alternative top district. But while a conventional bank like UBS is moving out of Central, more hedge funds, asset managers and other non-traditional financial firms are moving in.
Point72 Asset Management, a US hedge fund, has reportedly signed a deal to take a total of 85,000 sq ft of office space across seven floors, up from about 60,000 sq ft that it previously committed to take, at The Henderson in Central. Other new or expanding Central tenants include Chicago-based
Adams Street Partners and Paris-based private equity firm
Ardian.
Such firms accounted for 18 per cent of Hong Kong’s office leasing by volume in 2025, according to real estate consultant JLL.
Even so, it’s still an uphill struggle. Some 2.9 million sq ft of prime office space was added in 2025 – a three-year high – pushing citywide vacancy up to 17.3 per cent, with about 70 per cent of new completions still waiting to be leased. Overall, last year office rents recorded the smallest full-year decline since 2019. Rents in Central and Tsim Sha Tsui have mostly stabilised, but Hong Kong East and Kowloon East lag behind. The office vacancy rate dropped to 11 per cent in Central last year from 14 per cent in 2024.
Economic revival, including a red hot
initial public offering market, is attracting global investment companies and mainland Chinese firms to expand in the city. These usually look for offices in prime locations.
