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Securities and Futures Commission chief executive Ashley Alder participates in an Outward Bound event at One Island East on December 9, 2017. Photo: Winson Wong

Hong Kong’s SFC throws in the towel on Central rents, signs on for new office space at One Island East

  • The Securities and Futures Commission will exit Central, having signed a new lease for office space in Quarry Bay beginning in January 2020
  • New lease will lower monthly rent to around HK$55 per square foot, from around HK$120 currently
SFC

The Securities and Futures Commission (SFC) plans to move out of its Central office to save on rental costs as it forecasts a deficit of HK$230 million (US$29.3 million) for the year ahead.

The city’s securities regulator has taken out an eight-year lease in Swire Properties’ One Island East in Quarry Bay.

The move, set to take place under a lease beginning in January 2020, would likely reduce office rental costs for the regulator by about half, according to an agenda published online by the Legislative Council on Tuesday.

The move comes as a growing number of financial institutions and law firms in Central district are seeking out cheaper options in other parts of the city.

The SFC’s new office space in One Island East spans nine floors of up to 200,000 square feet, at a rental cost of around HK$55 per square foot per month, according to sources.

The space is currently occupied by JPMorgan, which has already signed a lease at The Quayside in Kowloon Bay across the harbour, sources said.

The SFC will pay a one-off cost of HK$40.83 million to cover the rental costs at offices in Quarry Bay and Central for three months in 2019-20 while renovations are underway. An aerial view of Hong Kong's Central district. Photo: Winson Wong

According to the published agenda, the SFC will pay a one-off cost of HK$40.83 million to cover the rental costs at both offices for three months in 2019-20 to allow for renovations.

They will also pay a one-off renovation cost for the new office of HK$140.4 million.

Since 2013 the SFC has occupied around 140,000 sq ft of grade A office space in CK Asset Holdings’ Cheung Kong Center, which is home to the world’s most expensive rent for premium offices. The SFC pays around HK$120 per square foot each month for almost seven floors in the building, according to sources.

The market watchdog is not the only company to flee soaring rents in Central. In November the Royal Bank of Canada committed to 44,000 sq ft over two floors in One Taikoo Place in Quarry Bay.

In November bitcoin trading platform BitMEX agreed to lease the entire 45th floor of Cheung Kong Center for HK$225 per square foot a month, making it the most expensive office in Hong Kong.

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