Despite the reopened economy, the flow of trade is still affected by the prolonged impact of COVID-19
For the third quarter of the year, CBRE reported that the sustained effect of the pandemic still managed to negatively affect trade flow from Hong Kong SAR, reported RETalk Asia.
The leasing demand for industrial space has remained low, but investment activity still managed to have been maintained due to the rising demand for data centres as businesses switch to cloud-based systems.
In their report, CBRE mentioned that “China Mobile acquired a government site for HKD5.6 billion (USD722.5 million), the most expensive government industrial land disposal on history.”
Some tenants have moved to new leases to save on expenses, either choosing more affordable locations or downsizing.
Businesses catering to the domestic market have maintained its stability, while self-storage providers dealt with a robust leasing activity amounting to 33,000 square feet of new lettings.
The report also revealed that cold storage facilities have witnessed a boost in demand, particularly with HSBC Life buying a scheme worth HKD325 million.
In the short to medium term, CBRE forecasts that “the pandemic will continue to cast a shadow over trading activity. Other key macro events that could impact the Hong Kong SAR include November’s US presidential election, the result of which may prompt a shift in US-China relations. Warehouse rents will likely edge down further over the next six months but are expected to be broadly stable in 2021.”
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