China CITIC Agrees To Lease 150,000 Sq Ft At Two Taikoo Place
HONG KONG – A local subsidiary of China CITIC Bank has agreed to occupy an office space measuring over 150,000 sq ft at Swire Properties’ Two Taikoo Place in terms of net leasable area (NLA), making it the largest office rental deal in the Chinese territory since the start of the COVID-19 pandemic, reported Mingtiandi on Monday morning (6 June, SGT).
“We are delighted to confirm that CITIC has pre-leased six and half floors at Two Taikoo Place,” which equates to 15 percent of the space at the commercial property, wrote Swire director and Head of office Don Taylor in an email to the news outlet.
“Preleasing for Two Taikoo Place is gaining momentum. In addition to CITIC, and Julius Baer which has committed to four floors (around 92,000 sq ft), we are also in active discussions with several prospective tenants from various sectors,” he added.
Previously, Julius Baer announced in May 2021 that it had committed to take up office space in Two Taikoo Place. However, that office building’s leasing momentum was significantly slower than One Taikoo which was fully occupied in about one year, based on Mingtiandi data.
Notably, One Taikoo was fully leased in 2018. It was regarded as one of Hong Kong’s large office leasing successes in recent years with Swire Properties’ leveraging on an ongoing restructuring of the city’s commercial eco-system by attracting tenants like Facebook, Baker McKenzie, and Jones Lang LaSalle (JLL) as multinational tenants shun Central’s then world-topping office rents.
Asking rents for Two Taikoo Place range from HK$42 psf to HK$50 psf per month. In comparison, that in One Taikoo Place was at HK$50 psf to HK$70 psf a month, when the developer was leasing out that 1 million sq ft office tower four years ago, shared Alex Leung, Senior Director at CHFT Advisory and Appraisal.
The latest office rental transaction was first reported in the Chinese language Hong Kong Economic Times.
Notably, the office building is poised to open in Q3 2022. Moreover, the office tower is a recipient of green certifications, namely WELL, LEED, and BEAM Plus Platinum.
The transfer by China CITIC Bank International from Swire’s 1993-vintage Devon House, which is just a stone’s throw away in Taikoo Place, follows a trend of corporate tenants upgrading their office premises as the city’s office market continues to struggle after years of tough times due to social unrest and China’s harsh COVID zero policies.
At present, office rents at Devon House currently average HK$30 psf, said Leung, adding that average Grade A office rents in Hong Kong Island East, a commercial district dominated by Swire’s Taikoo Place projects, have fallen 22 percent since Q1 2019.