Savills’ latest Hong Kong Office Leasing Market Report indicates that a fresh wave of expansion by hedge funds and quantitative funds that lifted Central Grade A office rents by 6.1% quarter-on-quarter and reduced vacancy from 9.4% in Q2 to 7.7%. Hong Kong recorded approximately 337,000 sq ft of net take-up during the quarter, with leasing demand extending beyond prime Central buildings into the wider district and other core locations. Robust initial public offering (IPO) activity, sustained talent inflows and a limited future supply pipeline are expected to provide further support, although the pace of recovery remains uneven across submarkets. For details, please read the attached report.
- New lettings and fund expansions tighten Central’s office market
A new wave of hedge fund and quantitative fund occupiers has accounted for 28 leasing transactions in 2026 to date, involving more than 149,000 sq ft. Approximately 79% of these transactions were new lettings or expansions. Notable deals included Susquehanna International’s commitment to approximately 51,762 sq ft at Cheung Kong Center II and IMC Trading’s lease of approximately 18,349 sq ft at Two IFC. This sustained demand helped drive Central rents up by 6.1% quarter-on-quarter and reduce vacancy to 7.7%, strengthening landlords’ negotiating position. - Demand spills over as prime Central buildings approach full occupancy
With IFC, Chater House and The Henderson approaching full occupancy, some occupiers are considering alternative buildings within Central and other core business districts to balance location, space availability and rental costs. Law firms, fund administrators and advisers are also seeking nearby premises as their clients expand. Wanchai/Causeway Bay and Tsim Sha Tsui recorded quarterly rental increases of 2.8% and 1.1%, respectively. By contrast, Kowloon East and Kowloon West saw declines of 1.4% and 0.5%, indicating that the recovery remains concentrated in better-located, higher-quality buildings. - Strong IPO activity supports professional services and family office demand
Hong Kong recorded 116 IPOs in the first three quarters of 2026, raising approximately HK$387.9 billion and setting a record for the nine-month period. Beyond issuers’ own office requirements, listings and subsequent placements and acquisitions are generating business for investment banks, securities brokers, law firms and auditors, supporting the expansion of their Hong Kong operations. Listed companies and their founders are also establishing family offices to manage assets, adding another source of demand for quality offices in core districts. - Policy initiatives and talent inflows broaden the occupier base
The report identifies the “Finance+” and commodity trading initiatives under Hong Kong’s First Five-Year Plan as potential medium- to long-term demand drivers for banks, asset managers, trading companies and professional services firms. Meanwhile, approximately 51,700 applications were approved under major talent admission schemes in the first half of 2026. The arrival of professionals and their families is also generating demand for education services. TianLi Education (Hong Kong) has leased approximately 36,400 sq ft at Tower B, China Life Center in Hung Hom for a new international education campus on a five-year term, illustrating the diversification of commercial property occupiers. - Below-average future supply is expected to support further core rental growth
New Grade A office completions are projected to average approximately 730,000 sq ft annually between 2026 and 2032, little more than one-third of the annual average of 2 million sq ft recorded from 1996 to 2025. Central is expected to have no new supply between 2028 and 2031. Based on the report’s detailed forecast table, prime offices in Central and Tsim Sha Tsui are forecast to record rental growth of 5%–7% in Q4, while other offices in Central, Admiralty and Tsim Sha Tsui are expected to see increases of 3%–5%. Rents elsewhere in Hong Kong are forecast to remain flat or decline by up to 5%, with market-wide Grade A rents expected to remain flat or rise by up to 5%.
Mr. Jack Tong, Director, Research & Consultancy of Savills commented,
“The office market recovery is gradually extending beyond fund expansion to professional services, family offices and related sectors. Robust IPO activity, together with the development of ‘Finance+’ and a commodity trading ecosystem, has the potential to broaden Hong Kong’s office occupier base further. New supply over the coming years is expected to remain significantly below the long-term average, supporting quality buildings in core districts. Nevertheless, differing demand and supply conditions mean the recovery will remain uneven across submarkets.”Mr. Ricky Lau, Managing Director, Head of Leasing of Savills said,
“The availability of quality office space in Central is narrowing, while a new wave of fund occupiers is actively seeking suitable premises. This is directing demand towards other buildings within Central and neighbouring core districts. Landlords have become more assertive on asking rents, incentive packages and renewal negotiations. For businesses planning to relocate or expand, an early assessment of space requirements and available options will help balance rental costs, building quality and business growth.”Mr. William Yiu, Deputy Senior Director, Kowloon Office Leasing of Savills said, “Performance across Kowloon remains mixed. Tsim Sha Tsui recorded modest rental growth in Q3, while Kowloon East and Kowloon West continued to experience rental adjustments. One notable development is the education demand generated by talent inflows, which is bringing occupiers beyond finance and traditional professional services into commercial properties. As businesses weigh location, building quality and costs more carefully, projects offering strong transport connections and flexible space options will be better positioned to attract a wider range of tenants.”