\n F&B Rents in First Rise Since Q3 2016 yet Relaxation of Cross-Border Restrictions may Impact Short-Term Demand <\/p>\n
Highlights of Office Market <\/u><\/p>\n
\n
<\/p>\n
-
\n\u00a0Citywide rents dropped 1.4% q-o-q, mild
\ndecline from -2.0% q-o-q in Q1<\/p>\n
\n
<\/p>\n
-
\n\u00a0Net absorption at -192k sq ft, improved from
\n-900k sq ft in Q1<\/p>\n
\n
<\/p>\n
-
\n\u00a0Availability rate at 14.4% is expected to remain stable in 2H
\n2021<\/p>\n
\n
<\/p>\n
\u00a0<\/p>\n
\n
<\/p>\n
Highlights of Retail Market <\/u><\/p>\n
\n
<\/p>\n
–\u00a0 YTD retail sales
\nincreased by 8.5% y-o-y <\/p>\n
\n
<\/p>\n
– \u00a0Vacancy rate
\nremained flat <\/p>\n
\n
<\/p>\n
–\u00a0 Overall rents to
\nstabilize in 2H 2021<\/p>\n
\n
<\/p>\n
–\u00a0 Relaxed travel
\nrestrictions will induce a short-term drop in retail demand as locals resume
\noutbound travel <\/p>\n
\n
<\/p>\n
\u00a0<\/b><\/p>\n
\n
<\/p>\n
HONG KONG SAR –\u00a0Media OutReach<\/a>\u00a0–\u00a07 July 2021 –\u00a0<\/b>Global real estate services firm
\u00a0<\/p>\n
Table 1 – Hong Kong Office Rents Comparison<\/p>\n Source: Cushman & Wakefield Research<\/p>\n Table 2 \u2013 New Leasing Transactions<\/p>\n Source: Cushman & Wakefield Research<\/p>\n Table 3 \u2013 Retail Sales Comparison<\/p>\n Source: Hong Kong Census & Statistics Department; Cushman &
Table 4 \u2013 Number of Fitness Centres in Hong Kong<\/p>\n Source: Hong Kong Fitness Guide, Asian Academy for Sports & Fitness
The F&B sector
\u00a0<\/p>\n
Office Market \u2013 Leasing Activity Increasing<\/u><\/b><\/p>\n
Overall rental
Net absorption
\u00a0<\/i><\/p>\n
Meanwhile, the overall availability rate remained at a
\u00a0<\/p>\n
A total of 2.75 million sq ft of new office supply
Retail Market \u2013 F&B
Local
Diving deeper
\u00a0<\/p>\n
Meanwhile,
\u00a0<\/p>\n
Furthermore, the
Notes: All sq ft measurements refer to Net Floor Area
\u00a0<\/p>\n
Please click HERE<\/b><\/a> to download the event photos and
\u00a0<\/p>\n
Photo Caption<\/p>\n
Photo1: (From
\u00a0<\/p>\n
Photo 2: (From
F&B Rents in First Rise Since Q3 2016 yet Relaxation of Cross-Border Restrictions may Impact Short-Term Demand Highlights of Office Market
-
\u00a0Citywide rents dropped 1.4% q-o-q, mild
decline from -2.0% q-o-q in Q1
-
\u00a0Net absorption at -192k sq ft, improved from
-900k sq ft in Q1
-
…<\/p>\n","protected":false},"author":1,"featured_media":16117,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[60],"tags":[],"_links":{"self":[{"href":"https:\/\/eodishasamachar.com\/en\/wp-json\/wp\/v2\/posts\/16116"}],"collection":[{"href":"https:\/\/eodishasamachar.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/eodishasamachar.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/eodishasamachar.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/eodishasamachar.com\/en\/wp-json\/wp\/v2\/comments?post=16116"}],"version-history":[{"count":0,"href":"https:\/\/eodishasamachar.com\/en\/wp-json\/wp\/v2\/posts\/16116\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/eodishasamachar.com\/en\/wp-json\/wp\/v2\/media\/16117"}],"wp:attachment":[{"href":"https:\/\/eodishasamachar.com\/en\/wp-json\/wp\/v2\/media?parent=16116"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/eodishasamachar.com\/en\/wp-json\/wp\/v2\/categories?post=16116"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/eodishasamachar.com\/en\/wp-json\/wp\/v2\/tags?post=16116"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\nCushman & Wakefield revealed today that both office and retail rental markets have shown initial signs of
\nstabilization in Q2 2021. While office leasing activity is on the rise, the average
\navailability rate is expected to remain at a similar level of 14.4% throughout
\n2021. Leasing activity was most active in the finance and insurance sectors. <\/p>\n
\n
<\/p>\n![](\"https:\/\/release.media-outreach.com\/release.php\/Images\/Thumb\/500x0\/161316\/CUSEN.jpg#image-161316\")
<\/p>\n
\n
<\/p>\n
\nWakefield Research<\/p>\n
\nProfessionals (HKSFP)<\/p>\n
\nretail rental value recorded an overall mild increase for the first time since
\nQ3 2016, mainly as a result of growing demand for fine-dining options as residents
\nhave turned to upscale dining experiences as an alternative to the travel they
\nenjoyed before the pandemic. Meanwhile, demand from lifestyle and wellness
\nbrands, including gyms and fitness operators, continues to rise as people’s
\ndaily routines and attitudes towards healthier lifestyles continue to take
\nshape. <\/p>\n
\n
<\/p>\n
\n
<\/p>\n
\n
<\/p>\n
\nvalue declined at a milder pace in Q2 2021, resulting in an all-district
\naverage drop of 1.4% q-o-q. Office rents in Greater Tsimshatsui and Kowloon
\nEast have dropped 3.5% and 2.3% q-o-q respectively, the highest two among all
\nsub-markets. Mr. John Siu, Cushman & Wakefield’s Managing Director, Hong
\nKong<\/b>, commented, “Office rental value is still under pressure as most occupiers
\nremain cost-conscious, availability of office space for lease is high, and the
\neconomy is still in its early stages of recovery.”<\/p>\n
\n
<\/p>\n
\nrecovered significantly from the record negative high figure of -900,000 sq ft in
\nQ1 to -192,400 sq ft in Q2. Surrendered stock dropped by 223,700 sq ft, or 31%
\nq-o-q, from 724,500 sq ft to 500,800 sq ft. Amongst the reduced surrendered
\nstock, 131,100 sq ft (59%) was leased by replacement tenants, and the remaining
\n92,600 sq ft (41%) returned to the market as direct stock. In terms of total
\narea, most of the new lettings in Q2 were committed by tenants in the banking
\n& finance (22%) and insurance (21%) sectors. MNCs contributed 65% of the new
\nlease area in the quarter, while mainland China and Hong Kong companies accounted
\nfor the remaining 20% and 15% respectively (Table 2). <\/p>\n
\n
<\/p>\n
\n
<\/p>\n
\nsimilar level of 14.4%, as compared with 14.0% in Q1.\u00a0 Mr. Siu<\/b> added, “We have seen a gradual increase in leasing
\nactivity and enquiries in Q2 as office occupiers have become more prepared to make
\nreal estate decisions in the past few months. Yet the overall availability rate
\nstill lingers at around 14%. We forecast the rate to remain quite stable for
\nthe rest of 2021, but overall space availability will rise next year when new
\nprojects are due for completion.” <\/p>\n
\n
<\/p>\n
\n
<\/p>\n
\nwill enter the market in 2022, including Two Taikoo Place, AIRSIDE, Millennium
\nCity 8, 388 Kwun Tong Road and 888 Lai Chi Kok Road. With new office space added
\nto the market, we anticipate that more large occupiers will take advantage of the
\ncurrent market downturn to make pre-lease commitments in these new projects for
\noffice consolidation, with a view towards minimizing their occupancy costs and
\nimproving their working environment. <\/p>\n
\n
\n
\n
<\/p>\n
\n& Wellness Demand on the Rise<\/u><\/b><\/p>\n
\n
<\/p>\n
\nconsumption has supported positive retail sales with an 8.9% y-o-y increase in the
\nfirst five months of the year. Sales from Jewellery & Watches and Fashion
\n& Accessories segments demonstrated positive growth of 34.2% and 25.6% y-o-y
\nrespectively (Table 3). Yet overall retail rents were flat in Q2, as both tenants and
\nlandlords remain conservative and cautious on the overall economic recovery in
\nthe long-run.<\/p>\n
\n
<\/p>\n
\ninto segment analytics, F&B and health and wellness are outperforming other
\nsectors. Mr. Kevin Lam, Cushman & Wakefield’s Executive Director, Head
\nof Retail Services, Hong Kong<\/b>, said, “The impact of the pandemic has
\nresulted in pent-up demand for relaxation and lifestyle adventures. We are
\nseeing surging demand for fine-dining as an alternative, prompting the F&B
\nsector, especially high-end authentic and specialty luxury dining, to lease superior
\nretail spaces in town. Yet, current demand is focused on F&B brands that
\nemphasize culinary journeys and personal experiences, and hence traditional and
\nchain F&B outlets may not benefit as much from this cycle of recovery.
\nHowever, we anticipate that relaxation of cross-China border restrictions in
\nthe near future will prompt a short-term drop in overall retail demand,
\nespecially in the F&B sector, as local residents resume outbound travel.” <\/p>\n
\n
<\/p>\n
\n
<\/p>\n
\nhealth and wellness brands are evolving and expanding their footprint in Hong
\nKong. The number of fitness centers, in particular 24-hour gyms, has grown exponentially
\nsince the pandemic. This fitness trend is expected to prevail in 2021 and into
\nthe years ahead (Table 4). <\/p>\n
\n
<\/p>\n
\n
<\/p>\n
\nnew HK$5,000 electronic consumption voucher offer to each eligible Hong Kong
\npermanent resident and new arrival aged 18 or above, totaling HK$36 billion, will
\nboost the economy by 0.7 percentage points. Apart from stimulating the local consumption
\nmarket, the scheme will also encourage smaller merchants, and consumers, to
\nadopt e-payment channels. Mr. Lam <\/b>continued, “With the registration
\nstarting on 4 July, we believe the scheme will give the market quite a positive
\nboost for the rest of 2021. Together with the potential release of the cross-China
\nborder restrictions in the near future, we remain cautiously optimistic about the
\ngradual recovery of the Hong Kong retail market.” <\/p>\n
\n
\n
\n
<\/p>\n
\n(NFA). Availability includes confirmed leasing stock that is currently vacant
\nor becoming vacant over the next 12 months.<\/i><\/p>\n
\n
<\/p>\n
\n
<\/p>\n
\npresentation deck. <\/p>\n
\n
<\/p>\n
\n
<\/p>\n
\n
<\/p>\n
\nLeft to Right) Mr. John Siu, Cushman & Wakefield’s Managing Director, Hong
\nKong and Mr. Kevin Lam, Cushman & Wakefield’s Executive Director, Head of
\nRetail Services, Hong Kong<\/p>\n
\n
<\/p>\n
\n
<\/p>\n
\nLeft to Right) Mr. Kevin Lam, Cushman & Wakefield’s Executive Director,
\nHead of Retail Services, Hong Kong and Mr. John Siu, Cushman & Wakefield’s
\nManaging Director, Hong Kong<\/p>\n<\/p><\/div>\n\n
Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"