Housing Authority to halve rent at 6,000 shops for two months
Fox Yi Hu
About 6,000 shops will pay only half their normal rent in January and February, courtesy of their landlord the Housing Authority.
The authority's Commercial Properties Committee decided on the temporary measure yesterday to help tenants in its shopping malls cope with the economic downturn.
The Link Management, meanwhile, which in recent weeks had resisted pressure to cut rents, reiterated that its top priority was to attract more shoppers to its malls and to persuade them to spend more.
The relief measure is expected to cost the authority about HK$30 million in rental income.
During the Sars crisis in 2003, the authority cut tenants' rent by half for three months.
Chairman of the committee Liu Sing-cheong said most members believed it was necessary to do something to help tenants of small and medium-sized shops.
Committee member and legislator Tommy Cheung Yu-yan hoped the authority's rent cut would press private mall owners to follow suit.
'Hopefully, this will put pressure on not only The Link but also other landlords,' Mr Cheung said.
A spokeswoman for The Link, which runs shopping centres on Housing Authority estates that were privatised through The Link Reit in 2005, said it believed boosting consumer spending was the way to help tenants of small shops.
She said the company would invest HK$10 million in promotional programmes over the next few months to stimulate business at its malls.
It would also invest HK$1.1 billion in asset-enhancing projects over the next three years that would create several thousand construction jobs, she said.
Tenants of The Link have recently protested against hefty rent increases, while activist shareholders have criticised it for charging low rents, which they say is not in the best interests of its stakeholders.
The Link Reit reported distributable income of HK$884 million for the six months ending September 30, up 13.9 per cent from HK$776 million last year.