The rent of stores in Hong Kong’s core shopping districts could plunge to 2006 levels – a decline of 40 per cent – by the end of this year, an agency that has tracked shop vacancies since 2016 said.
Rent could even drop by 80 percent in the next two to three years, if retail sales and the economy do not pick up, it added.
The agency, which deals in retail, office and industrial property, forecast that one in seven shops, or up to 15 per cent, will be vacant in the three months to September this year in the Causeway Bay, Tsim Sha Tsui and Central districts of Hong Kong, about double the same period in 2018. These districts along with Mong Kok will see 900 shops lie vacant in the three-month period, more than a historic high of 689 vacant shops recorded in February.
After the SARS epidemic in 2003, rent almost surged 10-fold in major shopping districts. A drop of 80 percent will bring rent back to that level.