TNAG-1483-FCO40-2037-Economic-situation-in-Hong-Kong-1986 — Page 238

The supply 5.11

(9) of new commercial

property

in the

first half of 1986, at 265 000 square metres in terms of

usable floor area completed, was 2% lower than in the same period last year. The vacancy rates at the end of 1985, at 9.0% of total stock for shops and 11.1% of

of total stock for

offices, were lower than those at the end of

of 1984. Given а relatively low supply forecast for 1986, the overall vacancy position is expected to show some further decrease this year.

5.12

The demand for shop space

in well-planned

developments in preferred locations (such as Tsim Sha Tsui East) continued to improve in the first half of 1986. Prices and rentals for shops showed gradual increases during this period. Nevertheless, demand was still weak for secondary shopping areas and some of the poorer arcade developments.

5.13

The

market

for offices showed considerable

variations between districts and between different grades.

business districts

remained strong in

influx of foreign

to Hong Kong by

in these areas

The demand for office space in the main such as Central, Tsim Sha Tsui and Wan Chai

the first half of 1986, helped by

by the

companies,

some of

which were

China's business potential.

attracted

Vacancies

continued to fall, and rentals firmed up in the first half of this year.

The temporary shortfall of available office

accommodation in these prime areas induced an increase in demand in the fringe areas such as Sheung Wan, Causeway Bay, Yau Ma Tei and Mongkok. The rental spread between these offices and those in the prime areas appears to have narrowed

as a result.

/5.14

(9) Commercial property is defined to include offices, shops miscellaneous commercial premises such as upper floor restaurants.

and

44