CHINA Resources Enterprise, the Hong Kong-listed flagship of mainland conglomerate China Resources (Holdings), has received a respectable response from prospective tenants for its new commercial project, the CRE Building in Wan Chai. Edward Lee, senior manager of sole leasing agent First Pacific Davies, said negotiations were under way for the lease of five office floors of the building. He said the potential tenants included insurance and accountancy firms, most of whom sought to lease whole floors. Some were companies hoping to relocate from nearby buildings. The 24-storey CRE Building has 20 office floors on top of four podium floors designed for retail operations. Each office floor is about 3,423 square feet. Mr Lee said his company had adopted a flexible approach to marketing the property. As well as whole-floor leasing, office tenants could take up space of 1,000 sq ft to 1,500 sq ft. He said the leasing rates for the CRE Building were competitive, with the lower floors set at about $26 per sq ft per month, and the higher floors about $33 per sq ft. The five floors involved in negotiations were mainly the lower floors, he said. Agents said rents for similar office space at nearby CNT Tower and Emperor Group Centre were about $35 per sq ft. Mr Lee expected that at least 30 per cent of the office space would be leased when the property was completed in July. The tenancy period for the building is two years, with a rent-free period of two months. Estate agents said the office rental market had softened in the past year and they expected the slide in rents to continue. Average office rents in Wan Chai North slipped to $51.40 per sq ft in April, according to the latest Vigers/Knight-Ridder Hong Kong property index. Agents said tenants now had more choices for office locations because of increasing supply. Landlords were facing difficulties in retaining tenants and so had to offer competitive rents. First Pacific Davies executive director, Raymond Lee said demand for commercial property was as high as ever in Wan Chai and his company anticipated no problems in leasing the building. 'The CRE Building will provide more than 80,000 sq ft of functional office accommodation and retail space in the heart of the Wan Chai district, and will be well served by all public transportation,' he said. 'All office units will be fitted with central air conditioning and connections for cable and satellite TV systems. 'The landlord will also provide ceiling tiles and light boxes.' Mr Lee is confident the CRE Building's striking entrance lobby will make it one of the most prestigious addresses in Wan Chai. The building, at 297 Hennessy Road, has with 24-hour access and security, and is within a few minutes walk from the MTR station in Wan Chai. Fact File DEVELOPMENT: CRE Building, a 24-storey office block at 297 Hennessy Road, Wan Chai. DEVELOPER: China Resources Enterprise. SIZE OF FLATS: 1,000 sq ft to 3,423 sq ft (whole floor). RENT: Lower floors about $26 per sq ft per month; higher floors $33 per sq ft per month. TOTAL AREA: About 80,000 sq ft of office space. COMPLETION DATE: July. SOLE SALES AGENT: First Pacific Davies. FACILITIES: Podium floors for retail operations including food and restaurants. TENANCY PERIOD: Two years.