Benedict Ma, associate director in CBRE's research department, said the shortage of new supply was expected to continue for the next three years. The firm estimates there is only 1.2 million and 1 million sq ft of new office space in the pipeline for 2012 and 2013, with most of it being in Kowloon East.

'Only three office buildings have been completed in Central this year. None are large-scale developments,' Ma said. Among them is the 28-storey 50 Connaught Road Central, developed by National Properties Holdings and Apollo Global Real Estate Management.

About 200 potential tenants - mainly mid-sized businesses - have inquired about renting space in the project. The floors range from 6,000 to 7,000 sq ft.

Nigel Smith, executive director of CBRE's landlord project services department, said asking rents ranged between HK$90 and HK$130 per sq ft and 30 per cent of the space had been taken up.

Analysts say the limited new office space and the smaller floors may drive large multinational corporations elsewhere.

Hong Kong has long been attractive as a regional base for such tenants because it is closer to the mainland than Singapore, for instance. But analysts say Singapore has a long-term view of town planning and is expanding its commercial district to attract multinational companies, while Hong Kong has not. That has led to tight supply and high rents.

CBRE says the vacancy rate for office space in Central dropped from 3.9 per cent in the fourth quarter of last year to just 3.7 per cent in the first quarter of this year. Meanwhile, average rents for grade-A office space in Central jumped 35 per cent to HK$111 per sq ft last year.

The firm expects rents will surge a further 24 per cent this year as demand remains strong and the supply pipeline is limited.

'The cost of operating an office in Hong Kong ranks at the top of the world already. If rents continue to go up they will dampen the competitive edge of Hong Kong as an ideal place for companies to set up Asia Pacific headquarters,' David Ji, head of research at consultancy DTZ in Greater China, said.

Cruickshanks of EC Harris singles out 'significant bureaucratic hurdles' as one reason for the absence of a clear long-term urban planning vision.

'The government should mandate one [authority] to authorise, control and execute planning of an area in Hong Kong, instead of requiring people to co-ordinate with all the different departments that may be involved,' he said.

'It should also understand what people want in a city, namely sustainable communities; not just office buildings to meet demand, but communities, which means planning for schools, playgrounds, transport networks, residential projects, sports projects, etc.'

Cruickshanks said Kwun Tong was an example of development that was not well co-ordinated.

'The industrial land in the area was released seven or eight years ago for the development of new office buildings,' he said. 'But if you ask people who work in Kwun Tong now, nobody would say they enjoy working in the area because of its noise pollution and unattractive visual landscape.'

The government should tackle a re-design of the urban landscape with greater care when encouraging landlords to convert industrial buildings into offices, he said.

Ji of DTZ said the government should provide suitable commercial sites and have long-term town planning based on market demand for each district.

'For example, financial institutions like to stay in Central, while Kowloon Bay only attracts companies' supporting departments,' he said.

Ji urged the government to consider the redevelopment of old districts in order to provide commercial sites in urban areas.