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Fitch Predicts Continued Challenges for CN & HK Leasing Environments Next Yr
Recommend 6 Positive 7 Negative 7 |
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Fitch Ratings anticipates the leasing environment for commercial real estate investment companies in Mainland China and Hong Kong to continue facing headwinds in 2026. Given the low net absorption in most markets and the ongoing supply, office vacancy rates may remain high, exerting pressure on Grade A office rents in major cities in Mainland China and Hong Kong. Fitch also highlighted that the operational and financial indicators of Fitch-rated investment-grade Hong Kong landlords have remained stable despite challenging market conditions over the past two years. These companies are anticipated to sustain robust performance on the back of their quality assets. Specifically, HYSAN DEV (00014.HK) (BBB/ Stable) and SHK PPT (00016.HK) (A/ Stable) are estimated to gradually increase office rental income as their under-construction office projects become operational in 2026. In contrast, WHARF HOLDINGS (00004.HK) (A-/ Stable) and YUEXIU REIT (00405.HK) (BBB-/ Stable) may continue to face rental pressure from new supply as they focus on Mainland properties without new projects under construction, though their conservative financial positions and asset quality still provide support for their ratings. AAStocks Financial News |
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