A new report from the organisation’s Asian branch calls for government action to increase the number of new office space sites in Hong Kong’s central business district and make decentralised locations more attractive to employers in the region.
Leadership is needed to provide clear guidance and an overarching strategy to ensure prices for Hong Kong’s Grade A office space do not deter companies crucial to the local economy, RICS said in its report.
Projections put together on behalf of RICS by CBRE suggest that the current supply of Grade A office space in Hong Kong would only be enough to match demand if the economy were to shrink by 5 per cent in terms of GDP in the three years until 2014.
However, expectations are for solid growth in the city’s economy, and so property experts predict that high-quality offices will be in increasingly short supply.
“Whilst decentralised hubs will go some way to alleviate the shortage of space, there is still strong demand for central locations and new supply needs to find a balance between the two locations,” said David Faulkner, chairman of RICS’ group studying the issue of office space supply in Hong Kong.
“RICS recognises that without an adequate supply of high-quality office buildings suited to the modern occupier’s needs, Hong Kong will become uncompetitive as a location for regional or global headquarters for the services industries,” he said.
The RICS study on office space in Hong Kong also makes the case for designing, developing, and ultimately renting out more sustainable buildings across the city. The issue is not currently a priority among landlords or tenants but “can result in clear benefits for investors”, it said.
Editor’s notes: In April 2023, it was reported that Hong Kong’s office vacancy rate had declined for the first time in 10 months in March, taking it to 12 per cent from 12.2 per cent.
It was also reported that there was net absorption of 203,900 square feet of office space in March, which has added to the city’s optimism.
The easing of Covid-19 restrictions and the reopening of the border with mainland China injected energy into the market, and Hong Kong’s government forecast gross domestic product growth of 3.5 per cent to 5.5 per cent during 2023.
Despite the unique internal difficulties that Hong Kong experienced during the pandemic, in 2022, the Central district of Hong Kong was reported as the most expensive location in the world in which to rent office space.
At the end of 2022, it was reported that there were 9.6 million square feet of vacant space city-wide, which was a record high.
Research conducted in June 2026 found that total net absorption in the Hong Kong office market reached 614,300 square feet in Q1 2026, down 59.7 per cent quarter-on-quarter. However, this was from an elevated base in Q4 2025, when multiple office schemes were completed.
The overall vacancy rate in the Hong Kong office market was also reported at 13.5 per cent in the first quarter.
Office rents in Hong Kong grew 1.5 per cent quarter-on-quarter between Q4 2025 and Q1 2026, equating to 4.1 per cent year-on-year.
JLL reported that in Q2 2026, total net absorption reached 492,000 square feet, as leasing demand from the financial sector remained robust and pushed the Central district vacancy rate down to 8.8 per cent.
The overall Grade A vacancy rate stood at 13.1 per cent.
A lack of new supply, combined with positive net absorption, led the citywide vacancy rate to fall.
The firm predicted that demand for Grade A space in Central would stay firm through 2026, supported by a strong IPO pipeline and mainland wealth inflows. Central Grade A rents were therefore forecast to rise 10-15 per cent over the year.
It was separately reported that the Central district led leasing activity with 100 deals in H1 2026, its highest first-half number since 2019.