PLUMMETING SALES AND RENTSThe Hong Kong retail property market has been faced with significant challenges over recent years, struggling with the impact of the social unrest in 2019 as well as the global COVID-19 pandemic. As tourist spending has been essentially non-existent during the stringent border control measures, retail sales have plummeted by 23.0% over the first nine months of 2021 compared to the same period in 2019.

Of all the sectors, luxury retailers have been hit the hardest, with sales retreating by over 47.5% over the same period, while supermarket sales in contrast showed resilience and posted only a minor -0.1% change. This has also been reflected in rental levels for both major shopping streets and prime shopping centres, which have retreated by 41.5% and 35.3% respectively over the two years to Q3/2021 according to Savills data.

Chinese visitors may not return in force until 2023. However, stable local demand will continue to support the retail property market.