New York office rents catch up to Hong Kong
New York is rapidly closing the gap on prime office rents with Hong Kong. Analysts say it could fall next year if the trade war persists, even as the special administrative region remaned the world’s most expensive city to set up shop for the fourth consecutive year.
According to a JLL report, the gap between occupancy costs rent, tax and service charge in Central and New York’s Midtown narrowed by 6 percentage points in the 12 months to September 2018.
Central’s annual rent growth of 4.6 percent also fell short of Midtown’s 9.3 per cent.
Denis Ma head of research at JLL told that solid economic growth in the US continues to provide support for the New York office market, with vacancy rates in Midtown reaching a 10-year low.
“Hong Kong, on the other hand, has seen rental growth slow against weakening mainland Chinese demand and a shaky stock market, with growth being supported only because of extremely tight vacancy rates in Central,” he added.
Central’s occupancy costs, stood at US$338 per square foot at the end of September.
This was 60 per cent higher than the US$212 per sq ft in New York’s Midtown
In contrast, Central’s occupancy costs at US$323 per sq ft in September last year was 66 per cent higher than New York Midtown’s US$194 per sq ft.
Source:South China Morning Post