Companies spread wings
From Central and Causeway Bay to Chai Wan, a company's location is of paramount importance to its business.
'The location of a company's peer group and client base has historically dictated location sensitivities,' says Alex Barnes, Jones Lang LaSalle's national director for Hong Kong markets.
Transport links are also important, whether to give staff quick access to the airport or travel to Shenzhen by train.
Other factors for consideration include office rent, the workplace's distance from where employees live and amenities and facilities nearby.
'Central is predominantly occupied by banking and finance businesses, and the high-end service sector. This is historically due to access the location has to clients, transportation networks and the Airport Express link, and the quality and range of accommodation available,' Barnes says.
Driven by a lack of space and high rents in Central, financial companies have spread to neighbouring Admiralty and taken over much of the traditionally mixed businesses there.
With prestigious addresses, but rents on average lower than in Central, Admiralty provides a good option for high-end services. Looking for even better deals, traditional central business district (CBD) users are moving into Wan Chai and Causeway Bay, and several business centres have established serviced offices there to cater to the needs of clients.
'Moving forward, we see key commercial clusters like those around Hysan Avenue in Causeway Bay and Swire's Taikoo Place portfolio in Quarry Bay becoming an extension of the traditional CBD on Hong Kong Island. This in part is due to Central's inability to grow and accommodate the expansion of the traditional Central businesses through new office development sites,' Barnes says.
Traditionally, Tsim Sha Tsui is the home of trading, garment and toy sourcing, with easy access to south China's factories.
Insurance companies have also made a home there, while the new International Commerce Centre is competing with Central for banking and finance tenants.
While Barnes applauds the government's planned development of the eastern Kowloon area, he is concerned about the intervening 10 years during which the development takes place.
'If managed appropriately, the district has the ability to keep Hong Kong competitive into the future,' he says. 'In the interim, thought should be paid to keeping Hong Kong a competitive business destination through the next decade.
'This requires appropriate interim office development to support business growth in the city.'