Hong Kong’s reputation as a safe haven could be reinforced by the geopolitical shock waves from the US-Israel conflict with Iran, potentially supporting demand for premium office space in its core business districts, according to analysts.

While the city was not insulated from global uncertainty, it could benefit over the medium term as Gulf investors reassessed geographic diversification and sought stable financial hubs, said Jack Tong, director of research and consultancy at Savills Hong Kong.

“In the short term – from late first quarter to early second quarter – US-Iran tensions and surging oil prices have weighed on leasing momentum, with March transactions slowing from a stronger start to the year,” Tong said.

“But over the medium term, as Middle Eastern capital intensifies its search for stable international financial centres with dual renminbi and US dollar connectivity, Hong Kong is poised to emerge as a key destination, supporting structural demand for grade A offices in Central, West Kowloon and Tsim Sha Tsui.”

Savills recorded 42 office leasing transactions in March, down from 76 in January and 64 in February. The figures track citywide leasing activity, with a focus on premium assets.

Multinational corporations (MNCs) had turned more cautious following strikes on Iran that began on February 28, as rising oil prices lifted operating costs and clouded earnings visibility, Tong said.