HIGH Hong Kong office prices and rentals could push international companies to consider Singapore or major cities in China as alternative sites to establish operations, says Bruce Walker, director of Vigers Hong Kong. Mr Walker said office prices were substantially higher in Hong Kong than for similar properties in many cities. While the price for top quality offices in Hong Kong could be as much as US$1,100 a sq ft, similar properties in the US would bring a mere $120, he said. Compared with Hong Kong, he said there were also many investment opportunities for good quality office properties in the US, Australia and Britain. Mr Walker said there was a possibility that international companies would consider alternatives in setting up offices because of the price of office space. Some could move to cities such as Singapore, or by-pass Hong Kong to establish offices or operations directly in mainland cities, he said. According to the latest Vigers property report, strata-title sales of office floors have remained the most active sector of Hong Kong's investment market in the past three months. For instance, office prices in Lippo Centre have exceeded HK$8,500 a sq ft, while some landlords are asking more than $9,000 a sq ft. In the Far East Finance Centre, asking prices are now more than $12,000 a sq ft. Vigers director Wilson Nei said the office investment market had been supported by strong speculative buying, largely from mainland investors. However, this had shrunk following the austerity programme implemented by the Chinese Government in July, and local investors who encountered problems of funding also adopted a wait-and-see attitude, he said. Mr Nei said demand for office space remained buoyant despite the slow down of sales activity in all sectors of the property market as a result of tighter mortgage lending restrictions by major banks, and the austerity programme in China. He predicted that office rentals would increase by a further 15 per cent for the remainder of the year. Mr Walker said rentals in the office market had continued to rise in the past quarter, with the increases varying depending on location. ''Average net effective rentals in Central are up 39 per cent from last year at approximately HK$53 a sq ft, with average vacancy rates for office space in Tsim Sha Tsui falling to below three per cent and those on Hong Kong Island down to one per cent,'' he said. He added that many tenants had been forced to relocate offices to non-core locations in recent months as a result of dramatic increases in Central. On the residential sector, Mr Walker said the tighter mortgage policies had curbed speculation and slowed down market activity for small and medium-sized flats. Prices in the mass residential market had remained ''stable'' while the luxury residential sector was still ''strong''.