Mainland Chinese brands are making a strong push into Hong Kong’s retail sector, seizing opportunities created by rising tourism and an influx of new residents. Industry analysis suggests that these brands will be among the most aggressive players in retail property leasing in the months ahead.

Despite an increase in visitor numbers, Hong Kong’s retail sector has faced persistent challenges, with sales declining for ten consecutive months. Official figures indicate a 7.3% drop in total retail revenue for the past year, amounting to HK$376.8 billion (US$48.5 billion).

As the market undergoes a restructuring phase, vacancy rates in prime retail spaces are expected to rise. This shift may lead to the departure of some traditional brands but also create room for emerging businesses looking to establish themselves in Hong Kong.

Mainland Chinese brands have been expanding into the city’s market for some time, with a strong presence in the food and beverage sector. Well-known chains such as Luckin Coffee and Little Sheep hotpot have secured key locations, paving the way for further investments from similar businesses.

With rental costs declining, new market entrants are expected to capitalize on favorable lease conditions. Data from IndexBox highlights rental market trends that could support this transition, making Hong Kong an attractive destination for brands looking to expand.

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