Vacancies in key retail areas drop to 6-year low
A commercial real estate services firm on Tuesday said the vacancy rate of retail properties in major shopping districts had reached its lowest level in six years in March. CBRE said the vacancies in four key shopping districts – Central, Causeway Bay, Tsim Sha Tsui, and Mong Kok – declined to between 5.3 and 7.4 percent last month, marking the first time since 2018 it had recorded a single-digit figure in the vacancy rate. Among these districts, Central saw the sharpest drop in the vacancy rate, at 5.3 percent, followed by Tsim Sha Tsui with a 2.9 percent decrease. Speaking to RTHK, Marcos Chan, CBRE's head of research, attributed the decline in vacancies to the improvement in inbound tourism and the government's efforts to attract visitors by hosting large-scale international events. "They are putting in quite a bit of effort in trying to bring in more international events to Hong Kong. So, hopefully with that going to happen, we will be able to see a moderate improvement in terms of tourist arrivals into Hong Kong. And that's very important for Hong Kong's economic momentum," he explained. CBRE also noted that while the food and beverage sector and luxury retailers slowed down their expansion, entertainment-related retailers remained active during the quarter. The real estate services provider added that transaction volume in the leasing market surged during the three-month period ending in March, with office leasing volume increasing by 35 percent compared to the previous quarter. However, commercial real estate investment volume saw a 5.5 percent decrease on a quarter-on-quarter basis to HK$13.2 billion. Chan said he expected the commercial real estate investment to rebound in the second half of 2024 if the US Federal Reserve decides to reduce interest rates.