Discounted rents help mainland Chinese retailers snag prime spots in Hong Kong

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The slumping retail market is forcing landlords to extend deeper discounts, providing opportunities for brands to expand in the city

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Cheryl Arcibal

Published: 9:30am, 3 Oct 2024Updated: 9:36am, 3 Oct 2024

Hong Kong’s slumping retail market is forcing landlords to extend deeper discounts to tenants, providing opportunities for brands to snap up prime spaces and expand their footprints in the city.

In particular, brands based in mainland China are finding space in high-street shops for a fraction of what they would have paid a few years ago.

“We expect that near-term leasing demand on the high street will be driven by popular mainland retail operators and [food and beverage] chains,” said Cushman & Wakefield in a recent report about the city’s retail market.

In the first seven months of the year, new leases by mainland Chinese brands surged 215 per cent from a year ago, according to JLL.

For example, Shanghai-based baby and kids’ apparel retailer Balabala is set to open its 11th and 12th Hong Kong shops in November, one in the Hopewell Mall Extension in Wan Chai and the other in Telford Plaza in Kowloon Bay.

Both outlets will occupy more than 1,000 sq ft, according to Eric Lee, the company’s general manager for Hong Kong and Singapore. Balabala is owned by Chinese fashion firm Zhejiang Semir Garment.