Classrooms in prime office buildings may look like an odd fit. But Hong Kong’s economic situation makes the arrangement not only practical but mutually beneficial. Given that office and retail vacancies remain relatively high, and universities struggle to secure enough teaching space amid a boom in non-local enrolment, converting commercial premises into off-campus teaching facilities offers a rare alignment of interests and a
win-win for both sectors.
At least six universities in Hong Kong have acquired office buildings or shopping centres over the past three years. The University of Science and Technology bought the former site of a Chinese restaurant at the United Centre in Admiralty for its business school for HK$345.4 million (US$44 million) last year. The University of Hong Kong, City University, Hang Seng University, Lingnan University and Metropolitan University also acquired commercial or retail properties, though some uses remain undisclosed.
In a market where weak sentiment has left many prime buildings under pressure, the education sector offers a source of demand that is more need-based than market-driven. According to real estate firm Colliers, education institutions, including international schools, have emerged as a major force in the city’s commercial market. Their share of total investment rose from 3 per cent last year to 23 per cent in the first six months of this year.
Meanwhile, the vacancy rate for grade A offices rose steadily from 9.6 per cent in 2020, reaching 17.5 per cent at the end of last year before easing to 16.6 per cent in May.
This development helps invigorate the property market while enabling more efficient use of idle commercial space. The universities are wise to take advantage of the downturn for value-for-money investment.
The trend is driven by the rapid expansion in tertiary education under the government’s bid to promote the sector. The non-local student quota at public universities was doubled from 20 per cent to 40 per cent from the 2024-2025 academic year,
rising further to 50 per cent from 2026-27 under the last policy address. The commercial premises come in handy as they are often centrally located and add to the appeal of the
“Study in Hong Kong” brand.
