Hong Kong average retail vacancy rate hits three-year record low in Q2

Leasing activities recover as Hong Kong’s retail sector continues to improve.

The average retail vacancy rate in Hong Kong declined to about 9% in the second quarter of 2023, hitting a three-year record low in the second quarter, as leasing activities recovered in several submarkets.

In a report, Cushman & Wakefield said retailers have reviewed and strategised their expansion plans as Hong Kong’s retail market recovered with the border reopening and supported by the consumption vouchers that drove spending.

Total retail sales in the market increased by 20.7% year-on-year from January to June to reach (HK$25.1b).

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Merchandise categories were the most popular amongst mainland visitors and posted the most significant rebound, along with jewellery and watches, apparel and accessories, medicine and cosmetics.

Leasing activities were the most active in the pharmacy, jewellery and watch sectors.

“The consumption pattern of mainland visitors has shifted towards experience-based activities rather than pure consumer-based ones, which has deterred some large brands from expanding,” it said.