With the average vacancy rate in the grade-A office sector expected to decline to about 11 per cent this year, the office market can achieve more than 30 per cent year-on-year growth in rental take-up this year, according to a Colliers Jardine report released yesterday. Research manager Simon Lo (right) said office rental rate had increased by 12 per cent to 16 per cent since the beginning of the year, due to the proliferation of technology companies. The average grade-A office rent in Central was HK$40.43 per square foot per month at the end of May. He expected new supply to taper in the next 18 to 24 months and grade-A vacancies to fall. The anticipated drop in office vacancies should lead to a further rise in rent this year and next. The average rent in Central and Admiralty is expected to hit HK$73 per square foot by 2003 when vacancies are down to 5.8 per cent, according to the research report. The residential sector was quiet during the second quarter due to the uncertainty about interest rates, Mr Lo said. Meanwhile, the rental rate of new industrial and office buildings is forecast to increase 8 per cent year on year as a result of growing demand for data centres, according to the report. Mr Lo said an improved price performance in the warehouse sector was anticipated due to burgeoning demand for logistics centres.