• APAC fintech investments increased 4 times from 2014 to 2015, predicted growth will increase by 20% and 10% in 2017 and 2018 respectively
• Arrival and emergence of new fintech companies will see greater demand for flexible office solutions
Hong Kong, 21 June 2016
– Structural changes in the traditional banking sector and the demand for innovative financial services have created significant growth in the fintech industry. In the report, Fintech: Strategies for the Surge, Colliers International examines on the potential implications for Hong Kong office market from this emerging fintech industry and suitable office solutions for prospective fintech occupiers.
Fintech has emerged as a way of using technological innovations to enhance or replace traditional banking operations. The industry is now growing rapidly with increasing interest from private investors and established financial institutions alike.
Colliers estimates changing business operations and service offerings of traditional finance institutes due to the rise of fintech will have a significant impact on office property markets around the world, especially in Hong Kong, where the finance industry accounts for a large percentage of office occupiers and given the city’ supply of office space is tight.
Speaking at a press briefing today, Yasas Wickramasinghe, analyst, Research and Advisory noted that, “The rise of these fintech companies will create demand for office spaces in core and fringe central business district (CBD) areas together with decentralised locations. While we expect companies that mainly service Hong Kong’s finance industry to attempt to locate in the core or fringe CBD, the demand for decentralised locations is likely to come from regional operators.”
“Fintech start-ups rely mainly on flexible workspace and other low-cost office solutions. Therefore, with growing interest in promoting fintech innovations, fintech start-ups could well become a primary demand driver for coworking spaces and non-prime buildings in the core and fringe CBD in coming years.” Wickramasinghe added.
Jonathan Wright, Associate Director, Office Services said, “In recent months, there have been new partnerships formed between accelerator & incubator operators and major International Banks to provide space for these fintech companies within the banks’ portfolios, the benefits of this for the banks are access to talent and controlled innovation. Besides, fintech start-ups can benefit from the networking opportunities and the sense of community created – this coupled with mentorship and investment is very attractive to a start-up.”
“We certainly expect fintech companies to drive some of the demand for flexible workspace and serviced offices, which are growing exponentially in footprint in Hong Kong.” Wright added.
Hong Kong is well-placed to cater for a wide range of fintech occupiers ranging from companies planning to serve clients within the city to companies that intend to enter the growing Asian fintech market. While Hong Kong government is taking significant steps to increase fintech competitiveness in the city, Colliers expects demand of flexible workspace to rise, fuelling the take up of space by flexible workspace operators.
To view the full report on Fintech: Strategies for the Surge, please click here.