SOURCE: RICS

RICS

August 02, 2017 09:34 ET

RICS Q2 2017 Hong Kong Commercial Property Monitor: Offices continue to outperform by strong demand from Chinese enterprises

Online shopping platform raises causing retail market lags

HONG KONG, CHINA--(Marketwired - Aug 2, 2017) - The Q2 2017 RICS (Royal Institution of Chartered Surveyors) Hong Kong Commercial Property Monitor revealed that the Occupier Sentiment Index (OSI) rose to six in Q2 from minus one in the previous quarter, and the Investor Sentiment Index (ISI) went slightly down to eight in Q2 from nine in Q1.

In the occupier market, the results show that the growth in demand for office space remains robust, while retail demand growth remains subdued. Office rents are expected to post a modest increase over the next quarter. Expectations remained nuanced between segments as a net balance of 63% of respondents expect office rents to increase while respondents expect a decline in retail rents.

"The demand of office market remains robust due to strong demand from Chinese enterprises that are expanding their offices in Hong Kong, especially on Grade A office," said Mr Frank Wong MRICS, RICS Hong Kong External Affairs and Public Concerns Committee Member. He added, "Consumer behavior is changing and as the online shopping platform rises, the growth in demand for retail market lags."

Capital values expectations remain robust for the next three and twelve months, with much of the positive sentiment driven by the office segment. Retail capital values are seen falling over the next three months, but flat over the next year. The majority (52%) of respondents see the market as approaching its peak (46% in Q1), although around one-quarter feel conditions are consistent with the middle stages of an upturn.

The RICS Hong Kong Commercial Property Monitor is a quarterly sentiment index tracking trends in the commercial property market. It is a leading indicator for global investment and occupier markets. The full report is available at www.rics.org/economics.

About RICS

Confidence through professional standards

RICS promotes and enforces the highest professional qualifications and standards in the development and management of land, real estate, construction and infrastructure. Our name promises the consistent delivery of standards -- bringing confidence to the markets we serve.

We accredit 125,000 professionals and any individual or firm registered with RICS is subject to our quality assurance. Their expertise covers property, asset valuation, real estate management; the development of infrastructure; and the management of natural resources, such as mining, farms and woodland. From environmental assessments and building controls to negotiating land rights in an emerging economy; if our members are involved the same professional standards and ethics apply.

We believe that standards underpin effective markets. With up to seventy per cent of the world's wealth bound up in land and real estate, our sector is vital to economic development, helping to support stable, sustainable investment and growth around the globe.

With offices covering the major political and financial centres of the world, our market presence means we are ideally placed to influence policy and embed professional standards. We work at a cross-governmental level, delivering international standards that will support a safe and vibrant marketplace in land, real estate, construction and infrastructure, for the benefit of all.

We are proud of our reputation and work hard to protect it, so clients who work with an RICS professional can have confidence in the quality and ethics of the services they receive.

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