Hong Kong moved up one place to register the world's second most expensive shop rents, as tourist spending rose. With average rent at US$1,695 per square foot per year, the city ranks after New York's Fifth Avenue in a report by property consultant CB Richard Ellis (CBRE) on global retail rents in the third quarter. Annual rents have risen 52.8 per cent in the city this year.
'In spite of the uncertain economic outlook, retailers see Asia as a growth area and are actively seeking opportunities either to establish a foothold or expand operations here,' said Edward Farrelly, the head of CBRE's Hong Kong research division.
'Hong Kong is a key destination as it has the added advantage of exposure to mainland China.'
Retail rent in the city rose 6.2 per cent quarter on quarter in the third quarter from 2.2 per cent in the previous quarter, Farrelly said.
New York rents stayed at US$1,900 per square foot per annum. Sydney ranked third, at US$1,224, followed by London and Zurich, the report said. Guangzhou was 10th, Beijing 14th and Shanghai 20th.
CBRE said rents had levelled off in many cities around the world as the euro-zone crisis continued to hammer consumer confidence.
Rents in New York rose 5.6 per cent this year, meaning Hong Kong was closing the gap, Farrelly said.