Hong Kong warehouse vacancy increases to 7.9% in Q2

Warehouse rents declined 1.5% due to vacancy pressure.

In a report, CBRE said Hong Kong industrial leasing momentum weakened further in Q2 2024. 

The biggest deal involved YA Logistics leasing 147,500 sq. ft. in Mapletree Logistics Hub Tsing Yi, followed by Dubai-based logistics company Aramex leasing 39,100 sq. ft. in interlink.

Here’s more from CBRE:

Warehouse vacancy rose 2.5 percentage points to 7.9% mainly due to the release of space in Cainiao Smart Gateway previously reserved by the landlord.

Persistent vacancy pressure caused warehouse rents to drop 1.5% quarter-on-quarter, marking only the second quarter-on-quarter decline reported since Q4 2020.

Samuel Lai, Executive Director, Head of Advisory & Transaction Services – Industrial & Logistics, CBRE Hong Kong: “The industrial leasing sector has experienced a decline for the fourth quarter in a row, primarily due to the slow recovery of China’s economy. However, we have observed an improvement in the business environment for trade and logistics companies, as evidenced by the increase in business receipts across the trading, warehousing, and courier sectors. While adequate trade activities will support Hong Kong’s economy for the year, the outlook is clouded by the upcoming U.S. election and geopolitical tension. The increased vacancy rate, resulting from the release of space in Cainiao Smart Gateway, has led to a 2.6% decrease in rents in the first half of 2024, compared to the second half of 2020.”