According to the latest market report, the overall Grade-A office vacancy rate in Hong Kong fell to 12.8% by the end of July, returning to levels seen in December 2023 and hitting the lowest point in 31 months. This improvement in vacancy rates was largely driven by declines across most submarkets, with Tsim Sha Tsui continuing to maintain a relatively low vacancy level.

Central outperformed other major business districts, recording the largest month-on-month vacancy rate decline among all areas. The vacancy rate in Central dropped by 0.8 percentage points to 8% at the end of July, reflecting sustained active leasing activity in the market.

Jones Lang LaSalle's Head of Hong Kong Commercial Markets noted that the office leasing market further warmed up in July, recording net absorption of 313,000 square feet. Financial institutions, banks, and professional services firms remained the primary drivers of leasing demand.

Based on discussions with financial industry clients, there has been a significant shift in fund preferences for establishing offices in Asia. In 2025, among newly established funds, 70% chose Singapore, 20% chose Hong Kong, and 10% chose Tokyo. However, this trend has clearly reversed this year, with over 70% of new funds opting to set up in Hong Kong. In the past month alone, eight out of ten funds chose Hong Kong, and this demand is expected to continue supporting the recovery of Central's Grade-A office market.

A senior research director at Jones Lang LaSalle added that overall office rents rose 0.8% month-on-month in July, driven primarily by rent growth in Central and Tsim Sha Tsui, where rents increased by 1.5% and 0.5%, respectively.