Goldman Sachs has issued a research report indicating that residential property prices and office rents in Hong Kong have performed stronger than anticipated this year. Consequently, the firm has revised its forecasts upward, now projecting a 15% increase in Hong Kong residential property prices for the year (up from a previous forecast of 12%). Forecasts for 2027 and 2028 remain unchanged at 7% and 4% growth, respectively. The bank maintains a preference for property developer stocks, believing they will benefit from a multi-year upcycle in Hong Kong's residential market. The report notes that residential prices have risen 8% year-to-date, with primary sales volume increasing by 48%. Rental growth has been slower, up only 1.2% year-to-date, reflecting a shift in some demand from renting to buying. Regarding the office market, Goldman Sachs has raised its 2026 rental growth forecast from flat to 3%. The forecast for rental growth in the core Central district has been significantly upgraded from 3% to 10%, while non-core areas are expected to remain flat year-on-year due to persistently high vacancy rates. The retail rental growth forecast has been adjusted slightly from 2% to 3%, primarily driven by the high-end segment (where the growth forecast has been raised from 4% to 5%). On individual stocks, Goldman Sachs has raised target prices for several companies. The target price for HENDERSON LAND (00012) has been increased by 8% from HK$38 to HK$41, with a "Buy" rating and placement on the "Conviction Buy List." The target price for Sun Hung Kai Properties (00016) has been raised by 4% from HK$164 to HK$170, maintaining a "Buy" rating. The target price for Sino Land (00083) has been increased by 5% from HK$15.2 to HK$16, also with a "Buy" rating. The target price for Swire Properties (01972) has been adjusted upward by 2% from HK$30 to HK$30.7, retaining a "Buy" rating. The target price for Hang Lung Properties (00101) remains at HK$11.5 with a "Buy" rating. The target price for Hysan Development (00014) is maintained at HK$24.9 with a "Neutral" rating. However, Goldman Sachs rates Wharf Holdings (00004) as "Sell," with its target price held at HK$25, reflecting concerns over its mainland rental income, development property margins, and volatile equity investment portfolio. The bank continues to favor developers with more salable resources to monetize during the upcycle, such as HENDERSON LAND and Sun Hung Kai Properties, as well as those with strong balance sheets and intentions to replenish land banks at lower costs, like Sino Land. Among property investment stocks, the firm recommends Hongkong Land and Swire Properties, which stand to benefit more from core Central office space and high-end retail.