Hong Kong to see the highest annual mall supply in two decades

Analysts expect around 4 million sq ft of new mall supply in 2024.

According to data from Colliers, the uptick in tourism drove the high-street rents in Hong Kong to grow by 2.2% QoQ in Q4 2023. Over the first 11 months of 2023, the accumulated retail sales was HKD370 billion, which was 84% of the same period in 2018. Certain sub-segments including F&B, gym and athleisure apparel remained strong and sought relocation or expansion to prime locations. 

On the other hand, the leasing momentum of goldsmiths, cosmetics and pharmacies slowed in Q4 as the purchasing power of mainland visitors was below market expectations.

“Inbound visitors will continue to pick up in 2024, and we expect the F&B, entertainment, healthcare, gym and athleisure sectors to be the main leasing driver of this year with our forecast in high-street rents to increase by 10% at most in 2024, outperforming the neighbourhood retail segment,” said Cynthia Ng, Head of Retail Services at Colliers Hong Kong.

In terms of new mall supply, 2024 will register about 4 million sq. ft. in new development areas or non-core districts, hitting the highest single year over the last two decades. “The new supply will bring a diverse shopping experience to consumers and provide opportunities for retailers to expand their footprint,” added Ng.