Local spending trends cast a shadow on Hong Kong retail rent growth

High street rents in retail areas grew modestly in 1Q24, by 0% to 1% QoQ.

Locals frequently travelling northbound to spend in the GBA cities have dampened recovery in retail rent growth in Hong Kong.

Data from Cushman and Wakefield showed that high street rents across retail districts recorded mild growth in 1Q24, ranging from 0% to 1% QoQ.

In the F&B sector, rents experienced a softer growth, with Causeway Bay and Central F&B rents increasing 1% QoQ, whilst Tsimshatsui and Mongkok recorded a drop of 2% QoQ.

Whilst high street rental growth slowed, the high street vacancy rate largely stabilised in 1Q24 due to tourist spending.

In Central, the vacancy rate dropped by 1.5 percentage points QoQ to 7.0%.

On the flip side, vacancy rates in Mongkok and Tsimshatsui rose to 11.1% and 11.8%, respectively, due to some festive period pop-up stores now departing high streets.