A mall in Tsim Sha Tsui has rented three floors to a dining and entertainment group for about HK$7 million per month - the biggest lease by size and value since the pandemic ended, according to a report.
The 80,000-square-foot space at Silvercord mall will be transformed into an anime-themed store featuring dining, retail and a play area, the Hong Kong Economic Times reported.
The site may include characters from Demon Slayer and One Piece, the report said. But the lessee has not been revealed.
The site was previously occupied by Hennes & Mauritz AB.
In 2008, during the peak of independent traveler spending, H&M rented two floors for approximately HK$7 million per month. Comparatively, the current lease for the anime-themed store at the same location is considered cheaper than during the peak period.
Mainland Chinese tourists have been returning to the city after travel curbs were lifted earlier this year. Visitor numbers increased from fewer than one million in January to almost 3 million in April, according to the Hong Kong Tourism Board. Retail sales in April reached 92 percent of 2019's level in the same period.
Commercial rents plunged during the pandemic due to Covid curbs. Leases in Tsim Sha Tsui fell 41 percent between 2019 and 2022, according to a survey by commercial property firm Cushman & Wakefield.
Tsim Sha Tsui has overtaken Causeway Bay as the city's most-expensive retail district, the survey showed.
Luxury brand Chanel leased a two-floor shop in a prime location in Causeway Bay in mid-May.
The French fashion house has committed to a three-year lease for the ground-level retail space at Capitol Centre according to government records. Ming Pao reported that Chanel agreed to pay more than HK$3 million monthly for the area.
The space, in front of a subway station exit, has a large facade, making it one of the most iconic retail spots in what was once the world's most expensive shopping street. Fashion retailers Forever 21 and Victoria's Secret had rented the area before it sat empty during the pandemic.F
Chanel is likely to pay just a fraction of the rents borne by previous tenants as rental levels slumped amid anti-fugitive protests and the pandemic in the past few years. Causeway Bay's rents in March were just 30 percent of their peak level a decade ago, according to the property agency.
While global luxury brands have shifted their resources out of the SAR amid signs that Chinese spenders will increasingly shop domestically, steep discounts in the world's most expensive real estate market have led to the rare opportunity to grab large shopfronts in the city.
According to another property agency, with the return of visitors to Hong Kong, there is a trend of tourist-driven retailers - especially drug stores - establishing their presence in retail cores.
Meanwhile, the demand for retail space from jewelry and watch retailers remains steady, but most luxury fashion retailers are exercising caution when it comes to expanding their presence.
Additionally, the travel patterns, spending behaviors and preferences of mainland visitors have become more complex than before the pandemic.
The agency expected the vacancy rates for stores in core areas to gradually decline in the second quarter.
