HONG KONG, Jan. 18, 2024 /PRNewswire/ — Leading diversified professional services and investment management company Colliers (NASDAQ and TSX: CIGI) has released its 2024 Market Outlook report, showing mixed sentiment across office, retail and industrial sectors in 2023 but looking ahead to a much noticeable recovery in the overall leasing and investment markets from H2 2024 onwards.

Colliers 2024 Market Outlook - Bill Chan, Fiona Ngan, Kathy Lee, Cynthia Ng, Thomas Chak (from left to right)
Colliers 2024 Market Outlook – Bill Chan, Fiona Ngan, Kathy Lee, Cynthia Ng, Thomas Chak (from left to right)

 “Hong Kong’s property market saw mixed results in 2023. With the return and inflow of tourists, retail market has recorded a significant 7.5% YoY rental growth in the high street shop segment. On the other hand, demand for warehouse spaces and Grade A office was weakened as the result of prevailing geopolitical and trade tensions, which was further impacted by the large quantum of new supply and record high vacancy rates. Looking ahead into 2024, we expect improvement in global economy and Hong Kong’s business environment, leading to a surge in demand for commercial spaces and an increase in transactional activities, ” said Kathy Lee, Head of Research at Colliers Hong Kong.

Grade A office rent

High-street shop rent

General industrial rent

Investment volume (HKD)

Q4 2023 (QoQ)


+2.2 %

+0.5 %

19 bn


2023 (YoY)


+7.5 %

+1.4 %

37 bn


2024 Forecast




50 bn



Against the backdrop of a slow economic growth and interest rate hikes, corporates prioritised cost saving over expansion throughout 2023. Amongst all industries, insurance was the most outperforming sector, supporting the rental market in Tsim Sha Tsui, which is the only submarket witnessed annual rental growth. Overall Grade A office rents dropped to HKD 52.9 per sq. ft. in Q4 2023 (–2.3% QoQ and –6.5% YoY). The Central Business District (CBD) experienced a significant rental drop with the Central / Admiralty submarket dropped to HKD 93.1 per sq. ft. (–2.4% QoQ and –8.2% YoY) in Q4 2023. Given a large quantity of new supply in Q4 2023 with low pre-commitments, the YoY net take-up of 2023 is –976,000 sq. ft., while vacancy rate is pushed to a record high of 15.9%, an increase of one percentage point (pp) QoQ.  

In 2024, Colliers expects a tenant-driven market thanks to the vast options from current and new supplies. “A weak rental trend will remain in place in H1 2024 as tenants are inclined towards taking a wait-and-see approach. The demand will be supported both by the technology, media, and telecommunications (TMT) and insurance sectors. Meanwhile, occupiers with sufficient budgets have the option to move to superior quality buildings, taking an advantage for flight-for-quality from the CBD fringe to the CBD. We anticipate Grade A office rental levels to remain under pressure with a drop of at least 2% in 2024,” said Fiona Ngan, Head of Occupier Services at Colliers Hong Kong.


Thanks to an uptick in tourism, the high-street rents grew by 2.2% QoQ in Q4 2023. Over the first 11 months of 2023, the accumulated retail sales was HKD370 billion, which was 84% of the same period in 2018. Certain sub-segments including F&B, gym and athleisure apparel remained strong and seek relocation or expansion to prime locations. On the other hand, the leasing momentum of goldsmiths, cosmetics and pharmacies slowed in Q4 as the purchasing power of mainland visitors was below market expectations.

“Inbound visitors will continue to pick up in 2024, and we expect the F&B, entertainment, healthcare, gym and athleisure sectors to be the main leasing driver of this year with our forecast in high-street rents to increase by 10% at most in 2024, outperforming the neighbourhood retail segment,” said Cynthia Ng, Head of Retail Services at Colliers Hong Kong.

In terms of new mall supply, 2024 will register about 4 million sq. ft. in new development areas or non-core districts, hitting the highest single year over the last two decades. “The new supply will bring diversity shopping experience to consumers and provide opportunities for retailers to expand their footprint, “commented Ng.


Industrial market faced several headwinds in the first three quarters of 2023, but a rebounded Purchasing Managers’ Index (PMI) in November 2023. The rental level of general industrial buildings stabilised with an annual growth of 1.4%. However, the third-party logistics operators (3PLs) slowed their leasing pace in 2023, registering a 1.1% drop in warehouse rents on the yearly basis.

“The leasing market was dominated by renewals in 2023 as tenants adopted a wait-and-see approach. The availability of new supply of 4.1 million sq. ft. lettable area added from Cainiao Smart Gateway in late 2023 doubled the overall vacancy from 3.1% in Q3 2023 to 6.6% in Q4 2023. The outlook for 2024 will be more favourable as optimism soars with new energy vehicles and health-related food manufacturing sectors, driving opportunities in the industrial market. We are confident that the gradual recovery will lead to stabilised rents for both general industrial and warehouse properties in 2024,” said Bill Chan, Head of Industrial Services at Colliers Hong Kong.

Capital Markets

The overall investment market was subdued in 2023 with only 65 major meals concluded with a total volume of HKD 37 billion, the lowest since financial crisis in 2008 and also a 28% YoY drop. The interest rate hike and the slower-than-expected economic recovery all contributed to the weakened investment market. Amongst various asset classes, retail, hotel and office sectors were boosted most significantly, with 57% of the total investment volume attributed by office sector, thanks to several big deals in Q4 2023. The capital value of general industrial and stratified offices declined by 0.7% QoQ and 1.0% QoQ respectively, whereas high-street retail price also dropped by 0.4% QoQ in Q4 2023.

“Institutional investors, who are rate-sensitive, looked for assets yielding over 4%. Throughout 2023, funds only accounted for 9% while end-users contributed for about 40% of investment volume. While the market expects the U.S. Federal funds interest rate to stabilise in the next six to nine months, coupled with the government’s initiatives on “Headquarters Economy” and the Capital Investment Entrant Scheme, this will likely improve investment sentiment and re-establish Hong Kong as an investment destination. We forecast investment volumes to grow by 37% YoY, from 2023’s low base, to HKD50 billion this year. Accommodation assets will continue to benefit from the inflow of talent and mainland Chinese students, while retail sector outlook remains positive amidst a stable tourism recovery, giving a 5% to 8% growth to the capital values,” said Thomas Chak, Co-Head of Capital Markets & Investment Services at Colliers Hong Kong.

About Colliers

Colliers (NASDAQ, TSX: CIGI) is a leading diversified professional services and investment management company. With operations in 66 countries, our 19,000 enterprising professionals work collaboratively to provide expert real estate and investment advice to clients. For more than 28 years, our experienced leadership with significant inside ownership has delivered compound annual investment returns of approximately 20% for shareholders. With annual revenues of $4.5 billion and $98 billion of assets under management, Colliers maximizes the potential of property and real assets to accelerate the success of our clients, our investors, and our people. Learn more at corporate.colliers.com, Twitter @Colliers or LinkedIn.