Date
21 August 2018
Hong Kong's premium office space has ranked as the world's most expensive over the past two years, and this has prompted many financial majors such Goldman Sachs to move to other locations in Hong Kong. Photo: AFP/HKEJ
Hong Kong's premium office space has ranked as the world's most expensive over the past two years, and this has prompted many financial majors such Goldman Sachs to move to other locations in Hong Kong. Photo: AFP/HKEJ

Goldman Sachs to move to Causeway Bay

Even the golden Goldman Sachs may be struggling to stay in expensive Central.

Well, there are other places in Hong Kong to choose from. A local report says the top US investment bank has signed a five-floor lease at Lee Garden 3 in Causeway Bay for its back office staff who are currently located at The Centre.

The move is expected to save Goldman Sachs, which has housed most of its staff at Cheung Kong Centre since 1999, about 30 percent in rent.

Apparently, Goldman managed to wangle a deal with Hysan Development for some 90,000 square feet of floor space at HK$60 psf.

The deal followed similar moves by its global peers to move their back offices from Central to save costs.

Rivals Morgan Stanley and Credit Suisse have moved to the International Commerce Centre from across the Victoria Harbour.

Last year, BNP Paribas moved to One Island East in Taikoo Place, Quarry Bay, while JP Morgan will move its One Island East back office to newly leased Grade A offices in Kwun Tong.

Other international firms such as Baker Mckenzie and Ernst & Young will move to One Taikoo Place by the autumn.

The office space vacancy rate in Central was 1.7 percent in January, down 0.2 percentage point, according to data from the Ratings and Valuation Department.

With limited availability of Grade A office space, rents in Central have gone even further north, thanks to the increasing presence of Chinese financial companies in the core financial district.

Central has held the distinction of having the world’s most expensive office space over the last two years, according to JLL.

The property consultancy also cited a 64 percent rental gap between prime offices in Central and those outside the CBD, which is also the widest in the world.

And so that explains why Goldman has made the move.

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CG

EJ Insight writer

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