Hong Kong’s government will refrain from selling commercial sites in land tenders this quarter as the office market continues to suffer from high vacancy rates.
“It’s reasonable for us to pause” on the sale of commercial plots in the fiscal third quarter ending Dec. 31, Secretary for Development Bernadette Linn told reporters on Wednesday. “We see that the vacancy for commercial space is on average at 10% or more.”
The office market downturn has left Hong Kong’s government in a dilemma. On the one hand, selling land now will only fetch a low price given developers’ pessimism. But holding onto the sites until the market recovers will deprive the city of revenue from land sales as it tries to repair finances that remain strained due to a weak economy.
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