Global multistrategy hedge fund firm Qube Research & Technologies Ltd has signed the second-largest prime office lease in Hong Kong’s Central business district in more than a decade.

The London-based firm is set to take as much as 146,000 square feet (13,564 square meters) across six floors in Two International Finance Centre being vacated by UBS Group AG, according to Murray Steel, Asia-Pacific chief operating officer. 

The lease will start in the first quarter of 2027, making it the largest tenant in the IFC complex, according to data from Jones Lang LaSalle, an adviser to the deal.

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One of the fastest-growing hedge fund managers in recent years, Qube joins deep-pocketed financial firms to lock in leases at attractive prices. A glut of new supply and cost-cutting at other companies have pushed up Hong Kong prime office vacancies and depressed unit rental rates.

Qube follows proprietary trading giant Jane Street Group, which in June agreed to take more than 223,300 square feet in Henderson Land Development Co’s Central Yards project under construction on the Victoria Harbour waterfront.

Qube was spun out of Credit Suisse Group AG at the start of 2018 with $800 million in capital and about 80 employees, focusing on quantitative trading. It has grown into a $38 billion multistrategy firm by earlier this year.

Its new lease is the largest ever signed by a hedge fund firm anywhere in Hong Kong.

The Hong Kong Monetary Authority is the largest occupier of office space in Two IFC but owns the area that houses its staff as well as that of the International Monetary Fund, Hong Kong Mortgage Corp and Bank of International Settlements, according to a past HKMA press release and JLL.

The Qube deal signals the Central area office market has bottomed out, according to JLL. It predicts grade-A office rents in the business district to rebound as much as 5 percent next year, after a 1 percent dip this year, while rents in other areas of the city are projected to remain flat to 5 percent down in 2026.

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Five of Qube’s 13 offices are located in the Asia-Pacific region, home to about one-third of its roughly 2,000 global employees, said Steel. Since last year, it has expanded office space in Sydney, Shanghai, Singapore and Mumbai. 

In Hong Kong, it signed deals this year to add four floors in Central Tower in stages by early next year, expanding its space in the building by 80 percent to accommodate its growth before the move to IFC in 2027.

In addition to its traditional hedge fund strategies, Qube has also expanded its venture capital and power trading teams to the Asia-Pacific region, Steel said.

Hedge funds, private banks and wealth managers have been driving improved demand for office space in the second half. The net 1.64 million square feet of office leased in the six months marks the highest since the first half of 2019, JLL said. 

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Central and Tsim Sha Tsui across the harbor have led the recovery. Rental rates in the two districts edged up as much as 0.5 percent in the period.

“This signals that companies are expanding again, rather than merely consolidating,” it added.

UBS said last year that it would combine its offices across Hong Kong into a 14-story tower in the International Gateway Centre complex being developed across the harbor in West Kowloon.

The lease would give the Swiss lender 460,000 square feet of space, an 84 percent increase over the 250,000 square feet it said it would rent in 2022, before its takeover of Credit Suisse.