The Hong Kong leasing market showed a positive net absorption of 192,000 sq ft in May, notably with OKX Hong Kong FinTech Company leasing a floor at AIRSIDE in Kai Tak. Despite the completion of China Merchants Plaza adding new supply, the overall office vacancy rate improved to 13.6%, with Central and Tsimshatsui seeing drops, although Hong Kong East’s vacancy rate rose. Office rents continued their slight downward trend, with Hong Kong East experiencing the most significant decline. In terms of transactions, Litu Holdings acquired a significant share of shop and office units at Kam Chung Building for HKD 388.0 million, despite a previous failed attempt by the Winland Group to secure a compulsory sale of the building at a higher reserve price. 
 
In May, the residential property market experienced an overall month-on-month decline of 10.3% in transaction volumes, despite a rise in the primary market being offset by a drop in the secondary market, while mass residential capital values continued their downward trend. Developers, facing a supply glut and tight financing, continued to lower prices, as exemplified by Deep Water Pavilia undercutting other Southside projects. However, lower HIBOR levels positively impacted the primary market, leading to a significant price reduction and rapid sale of units at THE HENLEY. In the luxury segment, a unit at 8 Deep Water Bay Drive commanded a high price of HKD 213.5 million. 
 
Source: The Land Registry, JLL