Why Hong Kong bankers can’t afford to park their cars

If you’re a banker in Hong Kong and you’re tiring of the city’s protest-induced MTR closures and delays, you may now be thinking about abandoning public transport and taking your car to work. You might want to think again.

While bankers in Hong Kong can certainly afford to own high-end cars, the real status symbol for prestige-minded bankers in the land-scarce city isn’t a vehicle – it’s a permanent parking space in or near to their office block. Without one, bankers may find themselves desperately competing to find a spot. Hong Kong’s overall ratio of public parking spaces to private cars dropped from 1 to 1.5 in 2006 to 1 to 1.1 in 2018, according to a Report from the Director of Audit. Ratios in areas where banks have offices, particularly in Central, are likely to be much worse.

Securing a parking bay as part of your benefits package is an uncommon luxury in Hong Kong as banks cut costs and compete with other tenants in their high-rise blocks for a limited number of spaces to lease. Even Hong Kong’s largest buildings often only have a few hundred bays. At most banks, parking is the preserve of the most senior MDs, according to a banker and a trader we spoke with in Hong Kong.

If you want somewhere to park, you could consider…buying your own space. But again – this doesn’t appear to be a realistic option. While Hong Kong’s civil unrest has led to falls in commercial property prices, it doesn’t seem to have affected the market for parking in the city’s financial districts. A single parking spot among 402 bays in The Center – the 73-storey tower that housed some of Goldman Sachs' bankers until last year – has just been sold for HK$7.6m (US$969k), making it the world’s most expensive place to park a vehicle, reports the South China Morning Post. The identity of the buyer is unknown.

Might they be a banker, given that The Center’s Queen’s Road location puts it within walking distance of several financial institutions? Probably not. Data we compiled from recruitment firms suggests that managing directors at global investment banks in Hong Kong earn base salaries of about HK$2.9m – that’s only 38% of the price of a car bay at The Centre. The average MD bonus of HK$4m wouldn’t go far either – you’d have to save up for two years and spend almost all your payouts on parking.

Buying an apartment could be a better bet for bankers who want to own a piece of Hong Kong real estate. SCMP calculates that the car space in The Centre is worth about HK$56k per sq ft, more than three times Hong Kong’s median home price, which itself has topped global rankings for nine consecutive years, according to CBRE data.

Image credit: Viktor Juric, Unsplash

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