HONG KONG, CHINA - Media OutReach - 31 July 2018 - The RICS(Royal Institution of Chartered Surveyors) Hong Kong Commercial PropertyMonitor Q2 2018, a quarterly sentimentindex tracking trends in the commercial property market, indicated optimism andpositive momentum for the occupier and investor markets. This was underpinnedby the continued recovery of the retail segment. Sentiment surrounding officesand industrial segment remained elevated.

In terms of overallsentiment, the OccupierSentiment Index (OSI) increased to 23 in Q2 from14 in Q1. The Investor Sentiment Index (ISI) increasedmodestly from 19 in Q1 to 23 in Q2.

As for rentaldemand across sectors, demand for retail spaceincreased in the occupier market since Q2 2013, with landlords offering rentfree periods. Survey respondents continued to report anincrease in the supply of office and retail properties available to let at a more modest pace in Q2, landlord incentives remainedunchanged for these two sectors.

In the investment market, headlineinvestor demand remains robust in officeand industrial properties, driven by the increased foreign investment interestin Hong Kong Office space for the eighthconsecutive quarter. Respondents reported thatthe demand for retail properties increased for the first time since Q4 2012,driven by domestic investors.

"Occupier demand increased from acrossall market segments in Q2, led by demand for office space. Notably, the outlookfor rents over the next year was similarly bullish -- respondents expect thebiggest increase in rents (in net balance terms) since Q3 of 2011," said RICS Chartered SurveyorMr Frank F Wong MRICS. "The capitalvalues in the overall market are still rising, indicating sustained positivemomentum in the investment market".

The outlook for rents was bullish, with the headlinerents expected to increase 4.4 per cent over the next year. Respondents see capital values increasingover the next three and 12 months across all segments of the market.

The RICS Hong Kong Commercial PropertyMonitor is a quarterly sentiment index tracking trends in the commercial propertymarket. It is a leading indicator for global investment and occupier markets. Thefull report is available at www.rics.org/economics.

About RICS

Confidence through Professional Standards

RICS promotes and enforces the highest professionalqualifications and standards in the development and management of land, realestate, construction and infrastructure.Our name promises the consistent delivery of standards -- bringing confidence tothe markets we serve.

We accredit 125,000professionals and any individual or firm registered with RICS is subject to ourquality assurance. Their expertise covers property, asset valuation, realestate management; the development of infrastructure; and the management ofnatural resources, such as mining, farms andwoodland. From environmental assessments and building controls to negotiatingland rights in an emerging economy; if our members are involved the sameprofessional standards and ethics apply.

We believe that standardsunderpin effective markets. With up toseventy per cent of the world's wealthbound up in land and real estate, our sector is vital to economic development,helping to support stable, sustainable investment and growth around the globe.

With offices covering the major political and financial centres of the world, our market presence meanswe are ideally placed to influence policy and embed professional standards. Wework at a cross-governmental level, delivering international standards thatwill support a safe and vibrant marketplace in land,real estate, construction andinfrastructure, for the benefit of all.

We are proud of ourreputation and work hard to protect it, so clients who work with an RICS professional can have confidence in thequality and ethics of the services they receive.

Media enquiry, pleasecontact:

RICS East Asia Public RelationsRepresentatives

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