Kowloon East set to be next CBD: CBRE

10.7 million sqft of Grade A office space has been built in Kowloon East.

Office submarkets in Kowloon East are emerging across Hong Kong, CBRE said and forecasted that the area might be the next central business district (CBD).

According to CBRE Research, since 2001, 10.7 million sqft of Grade A office space has been built in Kowloon East, bringing the total stock to the current 13.9 million sqft.

These areas are expected to receive growing demand from occupiers moving away from core submarkets to reduce costs.

Previously, declining demand for industrial buildings prompted the government to reclassify land use in various industrial areas, including Kowloon East, to Business use in 2001.

After that, Chief Executive Donald Tsang proposed to transform Kowloon East into a second-generation CBD in his 2011-2012 Policy Address.

CBRE Research estimates that the Grade A office footprint in Kowloon East will reach 17.2 million sqft and 29 million sqft by 2021 and beyond 2026, respectively.

This means that the district will eventually displace Greater Central as the largest office submarket in Hong Kong.

The firm also said future office development in Kowloon East will be spread across four clusters, Kwun Tong, Ngau Tau Kok, Kowloon Bay and Kai Tak, with stock estimated to stand at 8.0 million sqft, 2.9 million sqft, 8.3 million sqft and 3.7 million sqft, respectively, by 2026.

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