Hong Kong retail leasing volume hits record highs in 2023

The total leasing volume reached 1.5m sq ft for the year.

Retail leasing in Hong Kong saw a strong rebound in 2023 despite slower growth in H2 2023. In a report, CBRE said overall leasing volume registered 1.5 million sq. ft. in 2023, a record high.

Here’s more from CBRE:

F&B, cosmetics and pharmacies continued to expand on high streets to cater to the growing number of tourists. Luxury labels continued to hold a wait-and-see approach as they observe the change in tourists’ spending patterns.

Strong leasing demand ensured high-street shop vacancy dropped further to 9.1% in December 2023, the first time it has been in single-digit territory since Q1 2020, much lower than the 14.9% in December 2022.

High-street rents rose at a slower rate in Q4, increasing by 0.7% q-o-q, the smallest rate of growth since Q4 2022. This brought full-year growth to 6.3% y-o-y. 

Lawrence Wan, Senior Director, Head of Advisory & Transaction Services – Retail, CBRE Hong Kong: “The retail leasing market has improved significantly over the year, and even broke a record in new leasing volume of high-street shops. Looking ahead into 2024, recovery of the Chinese economy, anticipated strengthening of the RMB and potential interest rate cuts will lend support to tourist and local consumptions.  Attractive rental levels will also encourage retailers to reconfigure their branch networks. Retail leasing is expected to stay healthy. A moderate rental growth in the range of 5% is possible for high street shops in 2024.”