Hong Kong malls packed, yet sales tell a different story

What happened Swire Properties reported that its overall retail occupancy rate in Hong Kong held steady in 2024. The Hong Kong-based developer’s retail properties in the city, which include Pacific Place, Cityplaza, and Citygate Outlets, maintained full occupancy throughout the year. However, retail sales at each venue dropped by 10.7%, 2.3%, and 3.9%, respectively. In mainland China, occupancy rates across Swire’s retail properties ranged from 93% to 100%, with Taikoo Hui in Guangzhou fully occupied. Despite this stability, retail sales largely declined, except at Taikoo Li Qiantan in Shanghai, where sales increased by 3.4%. The Jing Take As Hong Kong navigates economic recovery in 2025, Swire Properties’ full occupancy across its malls reveals sustained demand for the city’s prime retail spaces. However, declining retail sales point to softer consumer spending — a shift that could influence tenant mix, leasing strategies, and brand positioning in the year ahead. Swire is just one of Hong Kong’s major developers facing challenging times. Embattled property developer and retail space owner New World Development continues to struggle with selling its assets, including its once-prized K11 Art Mall in Tsim Sha Tsui. This comes despite ongoing discussions with potential buyers, including a subsidiary of state-backed China Resources Group. However, no binding agreement has been reached. A price discrepancy with China Resources Land, which offered HKD 6 billion ($766 million), stalled the sale. New World Development recently reported a loss of HKD 17.13 billion ($2.19 billion) for the 2024 fiscal year, marking the first loss in 20 years. As part of its efforts to raise funds, the company also sold shares in several K11-related companies to AC Group Limited for HKD 209 million ($26.7 million) and sold its entire stake in New World Sports Development Limited to Chow Tai Fook for HKD 417 million ($53.3 million). Meanwhile, in mainland China, another bankrupt state-affiliated developer auctioned off a once-prized retail property. Temple Square, a deserted shopping complex in Shanghai previously owned by U.S. fund manager CarVal Investors, was sold below market value for 1.2 billion yuan ($164.6 million). Ultimately, with consumer spending softening in Hong Kong and mainland China, brands must rethink their in-store strategies, emphasizing experiential retail and localized engagement to drive foot traffic and conversion. The Jing Take reports on a piece of the leading news and presents our editorial team’s analysis of the key implications for the luxury industry. In the recurring column, we analyze everything from product drops and mergers to heated debate sprouting on Chinese social media.

Hong Kong malls packed, yet sales tell a different story

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Published February 14, 2025

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Hong Kong malls packed, yet sales tell a different story