Landlord will raise Citibank Plaza rates and is bullish on Langham Place outlook Great Eagle Holdings, the landlord of the giant Langham Place project in Mongkok, expects office rents to increase by up to 30 per cent next year, fuelled by a resurgence of demand from major corporations. The company, which also owns Citibank Plaza in Central, believes office rents in the central business district have returned to their 2002 levels. Assistant director Adrian Lee said: 'Office rents will experience a big jump next year. It will not be surprising to see 20 to 30 per cent growth as a result of a lack of new office supply in coming years.' Wasting no time, Great Eagle will increase office rents when leases come up for renewal at Citibank Plaza to $30 per square foot, a rate higher than it charged two years ago. By June, vacancy rates at Citibank Plaza had dropped to 16.7 per cent from a high of 26 per cent, set when the Hong Kong Monetary Authority, which had occupied 150,000 sq ft, moved to Two International Finance Centre in January. A substantial portion of the vacated space had been leased to two major financial institutions at higher rates, Mr Lee said. Deputy chairman and managing director Lo Ka-shui said demand for office space from trading and manufacturing-related firms grew on the back of strong economic activity on the mainland. 'As landlords started scaling back incentives offered to tenants, effective rent rates have also firmed up noticeably,' he said. Meanwhile, pre-leasing of the 59-storey, grade-A Langham Place office tower is under way, with an asking price of $15 to $20 per square foot for lower to middle floors. '[It] should become a major source of recurring income to the group in coming years,' Mr Lo said. The entire development is a 1.8 million sqft office-retail-hotel complex. As well as the 700,000 sqft office tower and a 15-storey shopping centre boasting 600,000 sqft - capable of accommodating more than 300 shops - there is a 686-room, 42-storey hotel covering 460,000 sqft. The five-star Langham Place Hotel had a soft opening in July and the initial performance has been encouraging. Great Eagle yesterday announced interim profit increased 15.3 per cent to $163.93 million for the six months to June from the Sars-affected period last year. For the same period in 2002, the firm reported a net profit of $274.35 million. An interim dividend of 3.5 cents was proposed, compared with three cents a year ago. Turnover grew 15.31 per cent to $1.28 billion. Great Eagle shares rose 1.64 per cent to close at $15.50 yesterday.