Office landlords in Hong Kong are finding new ways to adapt to changes forced by the pandemic. Property services company JLL said more offices are shifting to a "tiered membership" model to attract tenants.
Hong Kong, the world's most expensive commercial property market, has been hit hard by the pandemic. Landlords are under pressure to fill their office spaces - which has been made difficult as most of their corporate tenants have flexible working arrangements.
Landlords are embracing a revolutionary new leasing concept similar to the one used by co-working space providers. Tenants are being offered different levels of "memberships" for the use of building space and services.
The idea has proven successful in London and Sydney. Tenants can select from different services provided by a building to fit their needs.
For example, a tenant may want to use parking spaces, gyms and office space for a limited time. Another client might opt for office space only at a lower cost.
Traditionally, companies pay a fixed price based on area and length of lease. Rent often includes access to all amenities.
"With more corporations in the mainland and Hong Kong adopting flexible working arrangements, tenants are looking for more cost-efficient and productive ways to utilize space," JLL said.
Vacant office space in Hong Kong hit a record in September with about 7.8 million square feet - the most since 1999. Commercial real estate company CBRE said grade-A office rentals in the city dropped by more than 14% since a peak last year.