Swire Properties recently reduced office rents at Pacific Place 20 per cent from last year's peak when leases came up for renewal, but the company believes Hong Kong's office market has bottomed out, chief executive Martin Cubbon said. Office rents at One, Two and Three Pacific Place, comprising 2.2 million square feet, have dropped from as much as HK$100 per square foot per month last year to 'the high 70s to the low 80s', Mr Cubbon said. 'We are positive regarding the Hong Kong market in the coming months and next year in view of the renewed confidence, as evident in the surging demand in the residential market and growing confidence in the international business and financial sector to invest in Hong Kong. 'We expect a gradual pick-up, and we do not see a correction coming.' Occupancy rates at One, Two and Three Pacific Place and Taikoo Place were 99 per cent. Ninety-eight per cent of spaces of Swire's Cityplaza were let and 91 per cent were occupied in One Island East. Swire owns 15 million sqft of office and retail property in Hong Kong and 1 million sqft in Beijing. It plans to increase its investment properties to 24 million sqft by 2013, of which 8 million will be on the mainland and 16 million in Hong Kong. The company had less exposure to financial tenants, analyst Gary Pinge wrote in a Macquarie Research report. Macquarie has raised its forecast for office rents, saying they will grow 10 to 15 per cent by next year. This is a reversal of earlier predictions of a 10 to 20 per cent fall. However, property consultant CB Richard Ellis disagreed, saying grade A office rents in Central could decline a further 13 per cent in the second half of the year on top of a 27 per cent fall in the first half. In the residential market, Swire sold 50 units at its North Point development Island Lodge at an average of HK$11,000 per square foot when it relaunched the project early this month.