Twelve office floors at One Island East, a 67-storey Grade- A office tower in Quarry Bay, Hong Kong, have been sold for HK$5.4 billion (about $926 million). The floors were sold by Hong Kong-headquartered conglomerate Swire Group. JLL advised on the transaction.

The buyer was the Securities and Futures Commission (SFC), the regulator for Hong Kong’s securities and futures markets, according to a filing to the Hong Kong exchange by Swire Properties and its parent company, Swire Pacific. Both are listed on the Hong Kong Stock Exchange. Swire Pacific is also the largest shareholder in Cathay Pacific.

The sale involved the 42nd to the 48th floors and the 50th to the 54th floors. Currently, the SFC occupies the 45th to 54th floors, excluding the 49th floor. Its present tenancy agreement will be terminated upon completion of the transaction. SFC will complete the acquisition of the nine floors it already occupies by December of this year, with the acquisition of the remaining three floors to be completed by 2028.

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In a statement on Nov 17, JLL says the deal represents the largest end-use office transaction in Hong Kong since 2019. “Hong Kong’s office market is one of the most resilient asset classes globally, with strong and sustained demand in both the leasing and investment markets. We will see the demand improve further following stabilising global and mainland China’s economies,” adds Alex Barnes, managing director and head of office leasing advisory at JLL in Hong Kong.

Oscar Chan, head of capital markets at JLL in Hong Kong adds: “The interest rate hikes have impacted the investment demand for Hong Kong’s commercial properties in recent years. However, given that the demand dynamics, defensive nature and limited office supply in core business districts on Hong Kong Island, high-quality offices will continue to attract the interest from both end-users and investors,”