Currency

Prices are approximate and may vary by currency

Theme

3Q26 Hong Kong Preliminary Market Summary: Selective Recovery and Shifting Demand

Author: JLL marketing

The third quarter of 2026 showed a selective recovery across Hong Kong's real estate sectors, with varying performance in office, retail, residential, and industrial markets. 

Office Sector Gains Ground  

The office leasing market experienced a significant boost, with net absorption climbing 83.9% quarter-over-quarter to 904,322 sq ft. This growth was primarily driven by the financial sector, alongside education and energy-related occupiers. A notable transaction was Susquehanna International Group (SIG) expanding at Cheung Kong Center II. Overall vacancy edged lower to 12.5% at end-August, and rents rose by 2.4% quarter-over-quarter. 

Retail Sales Growth Decelerate  

Retail sales growth slowed from 7.1% year-over-year in 2Q26 to 4.5% in July 2026. While electrical goods, jewellery, and watches contributed to growth, motor vehicle sales dropped significantly following the expiration of the One-for-One Replacement Scheme. Prime shopping centre vacancy rose to 14.8%, and high street shop rents declined by 1.0% quarter-over-quarter. 

Residential Market Consolidates  

The primary residential market moderated sharply in July and August, with monthly sales averaging 869 units—the lowest level since the recovery began in 1Q25. However, unsold inventory in completed projects hit a record low. The secondary market also stagnated due to a divergence in price expectations between buyers and sellers, though luxury residential leasing continued to grow, driven by expatriates and mainland Chinese professionals. 

External Trade Remains Strong  

External trade maintained strong momentum, with imports and exports surging. However, prime warehouse leasing activities were mainly driven by renewals in 3Q26, and net absorption turned negative. Prime warehouse rents declined by 1.1% quarter-over-quarter. On the investment side, the industrial sector was supported by the significant equity transaction involving iTech 3.1 and iTech 3.2 data centres to Amazon Data Services Hong Kong Ltd.

Related articles