Analysts predict upbeat year for office space

Limited policy risks and a shortage of supply will ensure sustained investment activity in Hong Kong commercial property, agents say.

And capitalising on the strong and growing demand expected during the year, some developers are planning to offer some of their office properties for sale on strata titles, the agents add.

Johnnie Lau, executive director of Midland Commercial, a unit of Midland Holdings, said investors began to shift their focus to non-residential real estate after the government announced measures at the end of October, including a buyer's stamp duty, to cool down the housing market.

Buying sentiment was fuelled further when Chief Executive Leung Chun-ying did not announce any measures to regulate the investment market in his first policy address last Wednesday, Lau said.

Sales of new office properties rose 52 per cent year-on-year to HK$17.59 billion in 2012, according to Centaline Property Agency, the highest sales value on record since it began monitoring office transactions in 1996.

In the absence of any further policy risk, investor sentiment towards office and commercial properties would continue to improve, said Ringo Lam Chun-chiu, valuation director of surveyors AG Wilkinson & Associates.

Lau said his firm helped a buyer clinch a deal for HK$28.17 million, or HK$18,000 per square foot, just a few days after the policy address. The investor was able to move quickly once policy uncertainty was removed.