New Office Towers Signal Kwun Tong’s Transformation

Sun Hung Kai’s ‘Two Harbour Square’, the first Grade A offices to be completed in the district in 2017

16 May, 2017

New Office Towers Signal Kwun Tong’s Transformation

Grade A office supply in Kwun Tong has increased by an impressive 240% over the past decade. Located in Kowloon East and popular with businesses owing to its affordable rentals and high quality office stock, Kwun Tong is continuing to expand as an office district, with retail, residential and hotel properties in the pipeline well into 2024.

Government plans will see the Kwun Tong Action Area, as it’s now known, turn into a large-scale, commercial area. At its heart will be Sun Hung Kai’s Two Harbour Square, one of the hottest new office towers to launch this year.

“Two Harbour Square underscores SHK’s commitment to this area,” enthuses Paul Yien, Head of Landlord Representation. The acclaimed Hong Kong-based developer previously built Millennium City, one of the first Grade A office developments in Kwun Tong. “Now more buildings are emerging, such as Manulife Financial Centre and One Harbour Square,” Yien adds.

Link REIT and Nan Fung Group’s 77 Hoi Bun Road is also in the works, while Mapletree Bay Point is set to complete by year-end. Such properties will increase the Grade A office stock in Kwun Tong to more than eight million sq ft by the end of 2017.

“In the mid- to long-term, Kwun Tong will continue to attract Hong Kong-side tenants because new supply on Hong Kong Island is limited,” says Adrian Tang, Head of Kowloon Markets.

Two Harbour Square is especially attractive to occupiers looking for large floor plates and high quality relocation opportunities in Kowloon East, and boasts rare sea views. Rents are circa HK$25 per sq ft and are expected to hold in that range.

“Rental levels will remain relatively stable in the long run. The government’s initiatives to revitalise the district will support its growth,” predicts Yien.  

Kowloon East is already the second largest office district in Hong Kong, and will be home to approximately 17 million sq ft of Grade A office space by the end of this year. This increasingly mature market is drawing larger organisations away from Central.

Business clusters for insurance, sourcing companies, audit firms, engineering consultants, and construction management have sprung up in the area, alongside back-end offices for financial services companies, including Standard Chartered Bank, Bank of East Asia and ICBC. JP Morgan has recently committed to lease about 225,000 sq ft of office space for their office operations in the district.

In the coming years, this trend is anticipated to pick up pace. Kwun Tong is close to Kowloon Bay and the Kai Tak redevelopment zone, where the government is funding infrastructure and amenities to support Hong Kong’s thriving business community.

Kwun Tong itself is also set for large-scale urban renewal and revitalisation. The Kwun Tong Town Centre Development Area will see the rise of commercial, residential and hotel properties, scheduled for completion in 2024.

“With the development of even more commercial buildings in Kowloon East, and as the transport options – buses, minibuses – improve, Kwun Tong will reach its full potential,” Tang concludes.  

For more information about leasing an office in Kwun Tong, please contact Adrian Tang or view our local listings.