Hong Kong is Asia’s premier international transport and logistics hub, as well as an important gateway to Mainland China. It is also the world’s second busiest international air cargo centre and the third busiest container port after Singapore and Shanghai1. Efficient, reliable and well-connected, Hong Kong’s airport and port are important assets in the development of the country’s logistics industry.
The relative strength of domestic demand as well as the rapid economic growth in mainland China, with which Hong Kong’s economy has become more closely integrated, will continue to provide support to Hong Kong’s logistics industry.
Hong Kong maintains a vigorous program of infrastructure development to support the growth of the trade and logistics sector in air, sea, rail and land freight, as well as to enhance connectivity to Mainland China. The country’s warehouse leasing market has been well-supported by the closer integration of Hong Kong and China as well as the booming logistics sector over the past few years. The gradual take up of warehouse stock with little replenishment has meant that availability is currently extremely tight and vacancy is scattered across poorer quality stock.
In addition to the limited new warehouse space, some owners have chosen to convert their industrial properties to office or retail space, further reducing supply of industrial space. On the other hand, some investors have purchased industrial properties in order to redevelop them for other uses, thereby increasing the demand for industrial properties. As demand outstrips supply, quality logistics space is highly sought thereby providing support to rentals and capital values.
1Containerisation International; Airport Council International