Investors pay $10.6b for retail properties
Investors spent $10.6 billion on retail properties in the first three quarters of this year, accounting for 31 per cent of total property sales, according to Jones Lang LaSalle.
One of the biggest deals this year was department store operator Wing On's purchase of Causeway Bay Plaza for $1.2 billion from Lai Sun Development.
Jones Lang LaSalle head of research for Greater China Nelson Wong Chi-fai said he thought retail rental could increase by up to 10 per cent next year because of the improving economy and 'vibrant tourism industry'.
Landlords had increased retail rents in the third quarter, with those for highstreet shops up 7.6 per cent and for decentralised shops up 1.2 per cent, he said.
Sun Hung Kai Properties and Wharf (Holdings) have raised rents at their shopping centres by up to 30 per cent for some recently expired tenancies.
Jones Lang LaSalle estimates that a total of about 5.5 million square feet of retail space will have come on to the market by 2008. But much of this space would be in decentralised districts, leaving just 600,000 sqft in core commercial areas, it said.
The estate agent's survey covered deals valued at more than $30 million, down from $50 million last year because of a decline in large property transactions.
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