Singapore-based investors are Hong Kong’s top non-local commercial property buyers: Colliers

HONG KONG: Singapore-based investors have become Hong Kong’s top non-local commercial property buyers, according to Colliers. In fact, interest from investors based in the city-state is expected to remain steady in the coming months, said Colliers Hong Kong’s head of capital markets and investment services, Thomas Chak, as office asset prices there have fallen by up to 50%.

According to Mr Chak, Singapore investors were drawn to office assets there “more prominently” in the second quarter after years of price corrections made them more attractive, with many seeing an opportunity to acquire quality assets at discounted prices.

Singapore-based investors accounted for the bulk of non-local commercial property investment in Hong Kong during the second quarter, contributing HK$3.37 billion (S$554.35 million), or 62% of the HK$5.46 billion recorded from non-local and mainland Chinese buyers, the South China Morning Post (SCMP) reported, citing data from Colliers. Investors from mainland China, on the other hand, invested HK$1.23 billion during the same period.

In the first quarter, mainland Chinese investors dominated non-local acquisitions there, accounting for HK$4.73 billion. Singapore investors were then absent from the market.

Notable second-quarter deals involving Singapore-based investors included DBS Bank (Hong Kong)’s acquisition of about 152,000 sq ft of office space at the city’s fifth tallest skyscraper, The Center, for HK$2.62 billion and Wee Hur Holdings’ purchase of One Bedford Place in Tai Kok Tsui for HK$748.8 million, Colliers data showed.

Hong Kong’s office leasing market is showing signs of recovery, led by prime assets in Central, where Grade-A office rents rose 7.3% in the first half, marking the strongest six-month growth in 15 years, according to JLL. Vacancy in the district also eased to 8.8% from 10.9% at the end of last year.

Mr Chak said investors are likely to continue favouring “stable income-generating assets”, particularly in the education and living sectors, while owner-occupiers are expected to purchase “strategically located commercial properties for self-use and future expansion”. /TISG

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