Hong Kong Office Owners Face Headwinds as New World Discount Hits Record Low
New World Development Co. and Ares Management Corp. have sharply cut asking prices for units at their grade-A office project in Hong Kong’s Cheung Sha Wan district, in one of the deepest discounts seen in the city’s commercial property market. According to people familiar with the matter and local media reports, prices at 83 Wing Hong Street have been reduced by as much as 57% from levels when the project first launched sales in 2024, with some units now offered below the developer’s original land cost.
After factoring in discounts and rebates, certain floors at the 28-storey tower are being marketed at about HK$5,600 per square foot, with other units around HK$7,000 per square foot, the people said. That compares with initial asking prices of roughly HK$13,000 per square foot at the start of the year and is lower than the about HK$7,996 to HK$8,000 per square foot New World paid for the site in 2017. The aggressive pricing underscores the pressure facing owners of commercial assets outside Hong Kong’s core business districts, even as sentiment in the broader property market has started to improve.
The building, completed in 2023 and branded “83 Wing Hong Street,” is located near Lai Chi Kok MTR station in Kowloon, about a five-minute walk from the railway and around a 20-minute train ride from Central. It comprises office space from the fifth floor upward, with a total gross floor area of roughly 440,000 square feet and includes both office and retail components. While the steep reductions have helped lift transaction momentum in recent weeks, they also highlight how landlords in non-core locations are having to adjust expectations to clear inventory.
Hong Kong’s office sector remains weighed down by high vacancies, particularly outside the traditional Central business district. Data from CBRE show the citywide office vacancy rate stood at 16.8% at the end of March, close to a historic high, amid a wave of new completions. That contrasts with signs of a broader recovery in the residential segment, leaving some investors reassessing exposure to commercial assets. Ares declined to comment on the pricing moves, while New World did not respond to requests for comment, according to earlier reports.
