Hong Kong developer Swire Properties Ltd expects more pressure on the city’s office market in the near to medium term.

“There will be sustained pressure on the Hong Kong office market, but our performance has been resilient over the last couple of years,” Chief Executive Officer Tim Blackburn said in an earnings briefing Thursday.

Still, Blackburn remains confident in sustaining occupancy rates despite current challenges. Rival Hongkong Land Holdings Ltd, the biggest commercial landlord in the city’s financial district, last week said it’s seeing a recovery in Hong Kong’s ailing office market.

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First-half recurring underlying profit fell 4 percent to HK$3.42 billion ($436 million), driven by lower office rental income in Hong Kong and increased sales and marketing costs for upcoming residential projects. Swire’s gross rental income from office dropped 4.7 percent in the period, according to Bloomberg calculations.

The developer could face limited pressure on Hong Kong office vacancies, Bloomberg Intelligence said. Tenancies accounting for just 3.6 percent of attributable gross rental income in June are set to expire in the back half of 2025, according to BI analysts led by Patrick Wong.