Britain in Hong Kong
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In trade settlement, the use of the RMB has become
Indeed, if the long-term historic growth patterns
increasingly popular amongst traders as it helps reduce
continue, it is feasible that an extra 40,000 headcount
transaction costs and currency risks. In fact, according to
will swell the financial sector in the next 10 years, which
market estimates, it is expected that 30% of China’s total
translates into an additional 6 million sq ft of office
trade will be transacted in RMB by 2015.
space demand by 2020.
As Hong Kong handles more RMB transactions, there is
However, with Central’s vacancy rate already at frictional
a need to develop more sophisticated RMB-denominated
levels with less than 1 million sq ft available as at the end of
investment vehicles and wealth management services.
2011 and future supply capped at 3.5 million sq ft for the
This will strengthen Hong Kong’s position as one of
next decade, a large amount of this anticipated demand will
Asia’s top wealth management centres, where USD 1.3
need to be met in office buildings outside Central.
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trillion worth of wealth was managed by over 300 funds in 2010.
To this end, a continuation of the current trend of decentralisation is probably the solution to help Hong
In addition to the above, Hong Kong has been the
Kong capture the opportunities brought about by the
preferred capital raising centre for Chinese enterprises.
RMB’s internationalisation.
The opportunities for raising RMB funds will not only further strengthen the IPO listings of Chinese firms on
Now the question is what makes successful
the Hong Kong Stock Exchange but will also lead to the
decentralisation? While some banking and finance sector
expansion of the bond market, providing mainland firms
tenants have shown a willingness to relocate outside
alternative options when they look to raise capital.
Central, they are selective and have a preference for large floor-plate buildings with space at between 25,000 and
All the above are pointing to the progressive development
50,000 sq ft. This would help explain why financial firms
of the RMB offshore clearing centre in Hong Kong which
such as Morgan Stanley, Deutsche Bank and DBS have
will be the transformational driver of the sustained growth
recently moved into the International Commerce Centre
in city’s financial sector over the next decade.
in West Kowloon and One Island East in Quarry Bay. As a consequence, developers and landlords need to ensure
While this growth will bring enormous opportunities for
that they are able to meet the needs of these tenants.
banks, asset management companies and other financial institutions, both local and overseas based, who are
Although the government has been keen to champion
eager to settle their feet in Hong Kong to capture this
the new Central Business District (CBD) in Kowloon East
boom, it will also create downstream demand for related
(otherwise referred to as CBD2), it is estimated that the
professional services such as accountants, lawyers,
process will take at least 10-15 years before the area
insurers and commercial real estate providers.
will be mature enough as a front office home for larger banking and finance sector tenants. It is clear that Hong
In the long term we expect increased demand for the
Kong needs an interim plan to further expand its existing
city’s Grade A office market, accompanied by a spill-over
CBDs in order to satisfy growing demand before the
demand for decentralised office space.
completion of the Kowloon East developments. We have no doubt that Hong Kong’s financial service platform would have sufficient capability to embrace the opportunities and challenges an offshore RMB clearing centre might bring. However, whether Hong Kong has a sufficient amount of high quality office buildings to accommodate the growing needs of the sophisticated banking and financial sector will be critical. A way has to be found in the meantime to allow Hong Kong to fully take advantage of the opportunity of becoming an offshore RMB clearing centre. Decentralisation is probably the answer for now.
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12年8月13日 上午11:57