Agencies rethink leases and hint at moving out of Central

PUBLISHED : Wednesday, 06 May, 1998, 12:00am
UPDATED : Wednesday, 06 May, 1998, 12:00am

International property agency Colliers Jardine says it is likely to move from its offices on the 31st floor of Pacific Place 2 and ninth floor of the The Gateway in Tsim Sha Tsui when its leases expire later this year.

'We are looking at our options, but the chances are that we will be moving,' managing director Jonathan Petit said.

Colliers Jardine occupies 16,000 square feet in Pacific Place 2 and 5,000 sq ft in The Gateway.

It is the second big real estate group to consider moving locations.

Richard Ellis International recently said it was considering leasing new space when its tenancy on a floor of Bank of China Tower in Central expired later this year.

With a few million square feet of new grade-A office space coming on to the market and office rents 15-20 per cent cheaper than they were a year ago, agents said it made sense for tenants to look for bargains.

Colliers Jardine pays about $55 per sq ft for its space in Pacific Place 2, according to market sources.

'They could find new space at half of what they are paying now,' the source said.

Agents said it was paying 'in the high $30s' per sq ft gross for its space in The Gateway.

Mr Petit said cheaper rent was only one of the company's considerations. It was looking to keep a small agency representation in Central with the remainder of its operations, such as property management, possibly outside the Central area.

'The main reason for the move is that we don't have to occupy this kind of space in Pacific Place 2 to do property management business,' he said.

However, it was far too early to say where the property management side of the operation would be located.

Mr Petit said the company was considering moving out of its Canton Road location because it wanted to be nearer to the industrial/office (I/O) and industrial markets.

'We want to concentrate on our I/O and industrial markets and to be close to it,' he said.

Discussions with its present landlord, Swire Properties, about a new lease had not progressed far. 'The indications were that what they were interested in was not in line with our expectations,' he said.