Hongkong Land Holdings Ltd expects rents in its office towers to stabilize in 2027 after six years of declines as the financial hub’s commercial real estate market begins to recover, according to Bloomberg.
“Expiring rents are matched by a similar level upon renewal, which would mean that our office rents in Hong Kong would be flat and stabilize” next year, Chief Financial Officer Craig Beattie said in an interview with Bloomberg. The company expects to see rental growth in 2028, he added.
Average office rents for the firm in the first half of this year were HK$91 ($11.60) per square foot, a 4 percent drop from the same period last year. The company has seen rents decline since 2020 amid the city’s office downturn.
Potential rental growth in Hongkong Land, the Central district’s largest commercial landlord, is another positive sign for the city’s office sector. Grade A rents in Central rose 7.3 percent in the first half, the biggest six-month gain in 15 years. Vacancy rates fell to 8.8 percent from 10.9 percent at the end of 2025, according to Jones Lang LaSalle Inc.
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Hongkong Land reported Tuesday that underlying profit for the first six months of the year rose 11 percent from a year earlier. It raised its dividend by 33 percent to 8 cents a share.
Shares of Singapore-listed Hongkong Land rose as much as 4.3 percent on Wednesday morning, the most in more than two months. The stock has gained about 16 percent this year.
The company expects to see rental growth in its Landmark mall in Hong Kong, where the firm is carrying out upgrades. Average retail rents for the mall rose 9 percent in the period. Rents per square foot for the retail portfolio hit a record high in the first half, according to Beattie, with rates expected to increase for the next five to 10 years.
Shanghai complex
In its large-scale, mixed-use commercial project Westbund Central in Shanghai, the company recorded an 85 percent commitment on the retail side and 95 percent on the serviced apartments for the portion of the project that has opened, Beattie said in a separate interview with Bloomberg Television. Three out of four office towers in the project are fully occupied, he added.
Hongkong Land is looking at a number of investment opportunities for its recently established $6 billion Singapore property fund, he said. The fund is part of the company’s efforts to expand into real estate fund management rather than as a traditional developer or landlord. It has also been offloading non-core assets to raise cash for share buybacks in the past year.
READ MORE: Hongkong Land sees office market recovery with more demand
Singapore-listed Hongkong Land is owned by Hong Kong-based conglomerate Jardine Matheson Holdings Ltd.
