Hong Kong demand for flexible office space grows as market in Singapore slumps: report

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Bengaluru and Makati are the hottest spots as demand surged by 107 and 47 per cent, respectively, according to a study

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People crossing a busy street in Central business district, Hong Kong , in October 2024. Photo: Dickson Lee

Cheryl Arcibal

Published: 7:30am, 19 Dec 2024Updated: 9:22am, 19 Dec 2024

Demand for flexible office space in Hong Kong grew this year as a three-year slide in rental attracted companies from financial and legal sectors, while the market in Singapore slumped. Bengaluru and Makati emerged as the hottest cities.

Demand in Hong Kong increased by 11 per cent as the city ranked eighth in the Asia-Pacific region based on total flexible desk inquiries, according to a report by The Instant Group, a London-based operator of co-working facilities in 175 countries. Demand shrank 31 per cent in ninth-ranked Singapore, it added.

“Hong Kong is bouncing back, highlighting its resilience as a global business hub despite recent challenges,” the report on Wednesday showed. “Premium flexible spaces here continue to attract [the] finance and legal sectors.”

The decline in Singapore, traditionally a top market in the region, “signals a major shift in business preferences” as more companies turned to cost-effective alternatives or locations. Rents weakened 3.84 per cent in Hong Kong this year, while the rates for top-grade office space in Singapore have risen for at least 12 straight quarters, according to a Cushman & Wakefield report in October.

Office workers walking near the Marina Bay Financial Centre in Singapore on September 26, 2024. Photo: AFP

The shift in demand is shaped by factors including affordability, company diversification, untapped talent pools and thriving tech hubs with strong ecosystems, the firm said.