In short
Hong Kong commercial rents are usually quoted per square foot per month, so check whether the figure is on the gross area or the smaller saleable area. On top of the rent there is usually a management fee, and rates and government rent, paid by whoever the lease says. A lease must be stamped, with stamp duty from 0.25% to 1% depending on the term, usually shared between landlord and tenant.
1. Work out the full cost
- Rent per sq ft per month, and whether it is on the gross or saleable area (use our commercial rent calculator).
- The management fee, and rates and government rent: the lease says who pays them.
- The deposit (often a few months' rent), the agent's commission if you use one, and the fit-out.
2. Check the use and licences
Make sure the building's permitted use (in its deed of mutual covenant and the occupation permit) allows your business, and what licences you need, for example a restaurant licence from the Food and Environmental Hygiene Department.
3. Stamp the lease
Leases are subject to stamp duty, at rates from 0.25% to 1% depending on the length of the term, under the Stamp Duty Ordinance. Stamp within the time limit to avoid penalties; the duty is commonly shared equally by landlord and tenant. The Inland Revenue Department's Stamp Office publishes the current rates.
4. Agree the terms
- The term, any break clause and options to renew.
- Rent-free period for fitting out, and reinstatement when you leave.
- Who pays rates, government rent and the management fee, and who does repairs.
Checklist
- Rent per sq ft confirmed on gross or saleable area
- Management fee, rates and government rent allocated
- Use permitted and licences checked
- Lease stamped in time
- Fit-out, reinstatement and break terms agreed
Questions people ask
How is commercial rent quoted in Hong Kong?
Usually per square foot per month. Check whether it is on the gross area or the saleable area, which is smaller, before you compare.
Is stamp duty payable on a lease in Hong Kong?
Yes. Rates run from 0.25% to 1% depending on the term of the lease; the duty is commonly shared by landlord and tenant.
Who pays rates and government rent on a shop in Hong Kong?
Whoever the lease says. Agree it before you sign, together with the management fee.
Sources
- Stamp duty on leases: Inland Revenue Department, Stamp Office
- Rates and government rent: Rating and Valuation Department
- Restaurant and food licences: Food and Environmental Hygiene Department
Next steps
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