Real estate in Hong Kong remains healthy

Even by the standards of Hong Kong’s skyscraper-studded skyline, the new International Commerce Centre is big. Very big. And in a testament to the strength of one of the world’s hottest property markets, it is already nearly fully rented despite the global economic slump. At 1,607 feet, the gleaming, nearly complete tower is the tallest building in Hong Kong, with views of the Chinese mainland and the islands off its coast. The 118 stories of the International Commerce Centre, or ICC, also give it the rank of the world’s fourth-tallest building, behind the almost-completed Burj Dubai in Dubai, Taipei 101 in the Taiwanese capital and the Shanghai World Financial Centre.

It will be about 230 feet taller than the Freedom Tower at the World Trade Centre in New York, and about 590 feet above that of the so-called Shard in London, which will be the tallest building in Britain once completed in 2012.  The ICC, which is expected to be completed next year, further cements what has become a tradition in Asia: creating the world’s tallest buildings as a symbol of the region’s growing economic might. In Hong Kong, with its constrained topography and position as one of Asia’s leading financial hubs, property prices and rents are high.

Sun Hung Kai Properties, the developer behind the ICC, says the tower is almost completely leased. The developer locked in three prominent tenants, Deutsche Bank, Morgan Stanley and Credit Suisse, in 2007 and 2008, long before the ICC was near completion and while rents were still surging. The financial crisis meant that banks needed to find ways to save, and moving across Victoria Harbor from the central business district was attractive.

“There are only certain times in the economic cycle when you can fill buildings like these, tall buildings, where you need multistorey tenants,” said Paul Katz, president of Kohn Pedersen Fox Associated, the design architecture firm for the ICC.