Arrival of more senior executives lifts luxury segment

PUBLISHED : Wednesday, 20 October, 2004, 12:00am
UPDATED : Wednesday, 20 October, 2004, 12:00am

LEASING ACTIVITY for big serviced apartments appears to be picking up as more expatriate senior executives arrive.


Luxury Rental marketing manager Michael Fung said that while lower-end serviced apartments were popular, there was increased interest recently in serviced flats in the $40,000- to $70,000-a-month range.


'There are more senior expatriate executives coming to Hong Kong. We have received a lot of inquiries from pilots, architects, banking and securities executives for the bigger-sized units,' he said.


Mr Fung said three big furnished apartments with added services in Fairlane Tower in Bowen Road, Mid-Levels, had been leased in one week.


One 1,700-square-foot unit went for $66,000 a month on a three-month lease.


Early this year, similar units went for $62,000.


Confidence in the economy had returned and companies were hiring more staff. As a result, demand for serviced apartments had exceeded supply and landlords were raising rents, Mr Fung said.


'Leasing momentum has increased since the middle of last month after a relatively quiet period in August.


'Tenants are looking for properties with value-added services and good upkeep.'


He said a 571 sqft apartment with added services in Manhattan Avenue in Sheung Wan had been leased at $13,500 a month, compared with $12,000 for similar units early this year.


Mr Fung expected serviced apartment rents in Mid-Levels to rise a further 5 to 10 per cent in the short term.


Luxury Rental offers advice and solutions to small property owners on refurbishment and the provision of extra services to repackage their conventional residential units into serviced apartments for lease.


Mr Fung said more flat owners were seeking advice to add value and enhance the appeal of their properties. With furnishings and added services, a property could command a rental premium of at least 5 per cent and usually could find a tenant within a short time.


Signature Homes, the luxury residential marketing arm of Sun Hung Kai Properties, also said the atmosphere for the general leasing market had improved.


A spokesman said the firm was especially optimistic about the serviced apartment sector and expected to see rents increase this year and next as serviced suites had comprehensive facilities and services to suit all.


She said the overall occupancy rate was more than 96 per cent for properties in Signature Homes' portfolio for the first six months of this year. Its serviced apartment property The Royal Tower in Mid-Levels was fully occupied this year.


Its new serviced apartment project in Central, Four Seasons Place, would be ready for lease next summer, the spokesman said.