New World Development Co. and Ares Management Corp. have drastically cut the prices of office units at their 888 Lai Chi Kok Road project in Hong Kong, with reductions reaching up to 57%. This move is a severe indicator of the distress in Hong Kong's commercial property market, which has been experiencing a prolonged downturn.
For example, a unit on the 26th floor that was previously priced at HK$26,000 ($3,322) per square foot in 2021 is now being offered at HK$11,000 ($1,406) per square foot, a 57% markdown. Similarly, a unit on a lower floor saw its price cut from HK$27,000 ($3,450) to HK$12,000 ($1,534) per square foot, a 56% reduction. Overall, the current batch of units is priced between HK$10,800 ($1,380) and HK$13,500 ($1,725) per square foot.
This aggressive pricing strategy by New World Development comes as the company faces significant financial pressures. Earlier this year, it reported a HK$3.73 billion ($477 million) loss for the six months ending December 31. The developer is also under pressure to refinance HK$87.5 billion of its borrowings by the end of June and has pledged to accelerate sales of its residential projects to service its total liabilities of around HK$210.9 billion. This widespread discounting suggests a desperate attempt to offload inventory and generate liquidity in a challenging market.
In contrast to the commercial market downturn, the residential sector in Hong Kong has seen some signs of recovery. JLL reported in June 2026 that new project launch prices had rebounded by approximately 15% from four-year lows, moving away from aggressive discounting. Projects like Pavilia Farm III and The Blue Coast have seen initial price increases and some premium units achieving higher values, although residential prices generally remain below their 2021 peaks. However, the deep cuts in commercial property prices highlight a divergent recovery, with the office sector facing much steeper challenges.
