Key Contacts

    • Senior Director, Head of Marketing & Communications, Greater China T: +852 2846 7460 EAA Lic No E-426684
    • Director, Public Relations T: +852 2846 7175


Visiting Us

Hong Kong

Knight Frank
4/F Shui On Centre
6-8 Harbour Road
Hong Kong
Hong Kong
T: +852 2840 1177
F: + 852 2840 0600

News from Knight Frank Hong Kong

The near-term outlook for retail sales remains sanguine

28 February 2019

 Grade-A Office

Hong Kong Island

Amidst weak sentiment across the financial sector, leasing activities of premium Grade-A office space in Central, especially from Mainland firms, have almost come to a halt. Trends of decentralization still prevail. The pace of expansion for the co-working sector has been slowed down and became less active than last year. David Ji, Director and Head of Research & Consultancy, Greater China, Knight Frank, expects rents in Central to drop 4–7% in 2019.


After the Christmas and New Year holidays, the leasing market in Kowloon was active again in January. Looking ahead, leasing demand in Kowloon, largely from insurance companies, is expected to fare better than that of Hong Kong island. Office rents are expected to see a mild increase of 1–3% this year.


After dropping for five months in a row, Hong Kong home prices increased only 1.6% in 2018, the slowest growth since 2008, according to the Rating and Valuation Department. Monthly transaction volume increased 120.5% from the previous month, according to The Land Registry. There was robust demand in the primary market, with monthly sales expanding more than fivefold, from less than 400 to around 2,200.  

Entering the traditional off-peak season, the leasing market slowed before the Chinese New Year. Despite the overall market slowdown, the luxury segment still saw some leasing activities as tenants continued to be on the lookout for better deals.


Hong Kong retail sales in 2018 registered healthy growth of 8.8% YoY to HK$485.2 billion, the biggest increase since 2013. Overall market sentiment was positive in January 2019. The new mega infrastructure also resulted in record-high Chinese Mainland visitor arrivals during the holiday.

Retailers and F&B operators have been actively implementing new strategies to cater for the changing tourist behaviour and shift in preferences to fast-moving consumer goods.

Looking ahead, the near-term outlook for retail sales remains sanguine, as consumer sentiment has been buttressed by favourable employment numbers, stable income and vibrant inbound tourism. Nonetheless, given the external uncertainties, we expect to see retail rents in prime streets remain subdued in the short term.