Leading the way in quality
Tenants can enjoy benefits from energy-saving green features. Reports byKenneth Ko
Hysan Place, a newly-completed office and retail property tower built by Hysan Development, has added excitement to the commercial scene in Causeway Bay, and raised the level of office rentals.
Positive leasing responses have been generated for the 40-storey building, which provides 240,000 sqft of office space on 15 floors. Hysan Development targets high-quality tenants and, at the end of June, 40 per cent of the office space had been leased out. Estate agents estimate that more than 50 per cent of space has been committed.
KPMG is the biggest tenant, having signed a nine-year lease to consolidate its operations on about 80,000 sqft from the 20th to the 25th floors. Wuliangye Group, the Chinese liquor company, is another tenant.
The completion of Hysan Place has added new office spaces, but no negative impact has been felt in the market. According to property consultants Cushman & Wakefield, office availability remains low in Wan Chai and Causeway Bay. At the end of June, the office availability rate in the areas, including the space in Hysan Place, stood at 3.5 per cent, but was below 2 per cent if the building was excluded.
As a result of low availability and stable demand, Cushman & Wakefield estimates that office rents in Wan Chai and Causeway Bay rose 9 per cent in the second quarter compared with the first quarter, partly due to more costly space in Hysan Place. Office demand has been healthy, particularly from prominent retail brand operators, and the health and beauty sector.
Hysan Place is the only significant new mixed-use commercial building offering "AAA" grade office space on Hong Kong Island this year. Hysan Development says Causeway Bay is the natural extension of Central and its grade A offices offer a good cost advantage against other core areas. The landlord did not disclose rental rates, but agents say the asking monthly rents are in the region of HK$70 per sqft.
Thomas Lam, head of research for Greater China at Knight Frank, says top-of-the- range office spaces in Hysan Place have strong appeal to companies looking for quality premises, such as the grade A offices in nearby Lee Gardens. Leasing response has been satisfactory and offices on the high floors in the building offer attractive harbour views.
