The cost of renting office space in Hong Kong, one of the most expensive office rental markets in the world, is beginning to take a toll on international law firms.

In December, Freshfields Bruckhaus Deringer will move most of its Hong Kong office out of the city's prime financial district, known as Central, to an emerging business district further east called Quarry Bay.

And while Freshfields will be the first Global 100 firm to arrive in Quarry Bay, it won't be the last. According to sources close to the matter, as well as to Asia-based real estate blog Mingtiandi, Baker McKenzie is also in negotiations for a potential move to a new office tower in the district.

"Law firms in Hong Kong are looking east as part of the 'decentralise' trend," said Denis Ma, head of research at Jones Lang LaSalle (JLL) Hong Kong.

Central is a colloquial term referring to an area on the west side of Hong Kong Island's north shore that has been populated with banks, accounting firms, law firms and government headquarters since Hong Kong's colonial days. For decades, Central has been the financial and political centre of Hong Kong.

Hong Kong itself is already the most expensive place in the world to rent an office. Rent in Hong Kong's highest office towers can reach $304 (£230) per square foot a year, according to a skyscraper index released by Knight Frank in September. That's 46.7% more expensive than the runner-up: Manhattan.

And Central has long been the most expensive district in Hong Kong; average monthly rent in the district was $14.90 (£11.40) per square foot during the first six months of this year, whereas in Quarry Bay, which is on the east side of the island, the average rent is less than half that.

Hong Kong is already the most expensive place in the world to rent an office

Still, Central is popular among big law firms in Hong Kong. Fifty-five out of the 61 Global 100 firms located there have their offices in Central. Non-Global 100 firms, such as Loeb & Loeb and Kobre & Kim, are also based in Central.

Demand from mainland Chinese companies is most frequently cited by real estate analysts as the driver pushing up rents in Central. "If firms are in cost-containing mode, they will have to look elsewhere," said Ma. "It's not just the law firms; we see that trend across the board."

There's a pull factor too, Ma said. Law firms that traditionally were staunchly committed to remaining in Central are finally willing to consider relocating – not only because the new locations are less pricey but also because the offices there are of good quality.

Freshfields is moving to One Island East, part of Taikoo Place, a commercial and office complex eight subway stops east of Central. And the magic circle firm won't be alone there. Ince & Co and Berwin Leighton Paisner (BLP) made the move to Taikoo Place last year.

One Island East opened in 2008 and is much newer than many of the usual choices for law firms in Central. Freshfields Asia managing partner Georgia Dawson said the workspace in the new building was a big motivation for moving.

"One of the things we will have that we do not currently have is a lot of collaboration areas where cross-practice teams can come work together," she said. For example, that space will allow lawyers on a large M&A transaction to work alongside colleagues from competition, regulatory and disputes practices. "That will enable us to deliver efficiency to clients on a day-to-day basis," she added.

In addition to the collaboration areas, Freshfields' brand new, 40,000 sq ft space will have a 270-degree view of Victoria Harbour, a wellness room, an in-house cafe and other facilities that the current office, located in Central's Two Exchange Square, does not offer.

Freshfields will keep a smaller space in Central, mainly to make it easier for clients to attend the luncheons or roundtables the firm hosts; the small space in Central will also be helpful to the firm when it has to make urgent filings with the Hong Kong Stock Exchange or the High Court.

Central's Exchange Square is a group of four office buildings that includes the Hong Kong Stock Exchange, an institution at the centre of most international law firms' practice in Hong Kong for both transactions and disputes. Seven other Global 100 firms, including Latham & Watkins and Allen & Overy, are located there.

Dawson sees her firm as a trailblazer of sorts but anticipates that other firms will follow.

It may not happen so quickly, however. JLL's Ma said that while he has received plenty of calls from clients interested in moving their offices to locations outside of Central, most are not coming from law firms. "It may make sense on paper," he said, but the pace of decentralisation will only move as fast as the rate at which leases expire.

Landlords are very much part of the equation. Freshfields' new landlord, Swire Properties, part of London-based conglomerate Swire Group, is, according to Ma, part of the reason global law firms are attracted to Taikoo Place. "Firms moving from Central generally prefer to be part of Swire's portfolio for better management," he said.

Swire is the largest landlord in Quarry Bay; in addition to One Island East, it also owns BLP's building – Dorset House – and the upcoming One Taikoo Place, the building in which Baker McKenzie has reportedly expressed interest.

Quarry Bay has quite a fun dynamic; it's an up-and-coming part of Hong Kong

Bakers' current building – Hutchison House – is owned by local mogul Li Ka-shing's Cheung Kong Property, which, according to sources, is considering renovating the decades-old building and thus is less inclined to renew the lease. The US firm recently combined two offices into a four-floor space in the building on the eastern edge of Central.

A Singapore-based representative at Bakers said the firm has been reviewing premises options as part of its normal planning and does not have anything to announce now.

Swire's Central counterpart, Hongkong Land, owns Exchange Square, and is landlord to 37 of the 55 Global 100 firms located in Central. The offices are scattered across eight buildings, all connected by footbridges.

Ma said most of Big Law's favourite buildings – Exchange Square, the Landmark, and Jardine House – aren't the newest or the most high-end, compared with such buildings as the International Finance Center (IFC) or Cheung Kong Centre. "But they are well maintained and Hongkong Land is a good landlord," said Ma. (Sidley Austin and Morgan Lewis & Bockius are at IFC.)

Law firms are also quality tenants that landlords would like to keep. The more established international law firms actually have some leverage in lease negotiations since landlords prefer having good brand names on the door, Ma said.

But one other factor that is pulling law firms eastward is their clients, especially those in the financial sector. For a while, banks and insurance companies were moving mostly back offices to places like Quarry Bay, but increasingly, said Ma, the front offices are relocating too.

UK insurer Prudential, which had been at Exchange Square for a decade, moved to One Island East last year, before Freshfields made its move. New York-based asset manager AllianceBernstein will also move from Central to One Island East by the end of the year. In addition, Facebook has been a One Island East tenant in Quarry Bay since 2014.

At Freshfields, lawyers are excited about the upcoming move, said Dawson. The magic circle firm opened its Hong Kong office in 1985 at the then-brand-new Two Exchange Square. Dawson said the decision to move out to Quarry Bay was not taken lightly and lawyers and staff in the office were closely consulted about the design and new location.

"[Quarry Bay has] quite a fun dynamic; it's an up-and-coming part of Hong Kong," Dawson said. "It's going to be a positive move across the board."