“During Q3/2025, with rental decline remaining, market take-up increased compared to last quarter. On the demand side, the service sector continued to expand steadily. Co-working space providers’ performance varied.”

JAMES MACDONALD, SAVILLS RESEARCH



Vacancy rate ticks up with continuous new supply

• Throughout Q3/2025, Hong Kong Center T1 in the Hangkong Road submarket was launched, adding 65,000 sqm to the market. By quarter-end, the citywide office stock was 3.19 million sqm, up 8.1% YoY.

• The city’s improved net absorption level saw 24.9% QoQ and 11.3% YoY growth. The quarterly take-up hit 31,000 sqm, which was on par with the absorption in 1H/25.

• On demand side, law firms continued to dominate leasing demand in the professional services sector. The consumer service sector remained stable.

• During the quarter, the citywide average vacancy rate for Grade A office buildings rose 0.2 ppt QoQ and 2.3 ppt YoY. Due to the continuous delivery, the vacancy rate hit a new high to 40.9%.

• During the adjustment for stock projects, landlords continued to soften their leasing policies to increase occupancy. By quarter-end, rents fell to an average of RMB75.9 psm pmth, the rent index down 2.3% QoQ and 10.6% YoY.

• New supply intensifies competition between old and new projects while landlords keep adjusting rental policies to support occupancy. Hence, the citywide Grade A office average rent decline is expected to extend.