Although we are not out of the woods yet, some signs of improvement have been noted in the first quarter as rates of rental decline have slowed and retail sales have picked up. 

• Despite the impact of the fourth wave of infections and an absence of international visitors, Hong Kong’s retail sales turned around in the first two months of 2021 with total sales value up by 2.7% YoY.
• The leasing market showed early signs of revival in the first quarter while consumer sentiment and business confidence have been gradually improving. 
• Given a more local-centric market environment, shopping centre landlords are increasing their leisure offerings for families, and a number of international entertainment operators/concepts have made their debut in the Hong Kong market.
• Rates of rental decline are slowing in both the prime street shop and major shopping centre segments.
• The rollout of a vaccination programme, the relaxation of social distancing and the reopening of borders will all help to fuel a recovery in the tourism and retail markets in the near term.