Causeway Bay office rents fell 3.2 per cent last month, the most significant drop in Hong Kong Island districts, according to Chesterton Petty.
The consultant said landlords were particularly flexible about rents after two big companies had terminated operations, surrendering 100,000 square feet in Causeway Bay.
Rents of selected key island office buildings dropped 2.5 per cent and fell 0.6 per cent in Tsim Sha Tsui.
Economic woes in Argentina and at home contributed to a cautious attitude towards leasing office premises. China's accession to the World Trade Organisation did not appear to have any significant impact.
Office vacancies on Hong Kong Island rose 0.4 of a percentage point to 8.5 per cent. The Sheung Wan vacancy rate rose from 19.9 per cent in November to 21.4 per cent last month, but vacancy rates in other districts increased modestly - by about 1 per cent, Chesterton Petty said.
The office sales market remained quiet as the uncertain economy more than offset the positive effects brought about by interest rate cuts and strong residential sales. Office prices declined 0.7 per cent on average.
