Local character 'key to keeping Hong Kong's allure'
Sustainable future as shopping destination depends on retail variety, consultant warns
Hong Kong is losing its edge in attracting mainland shoppers as the city's local character fades from its prime shopping districts, a property consultant warns.
"The government should consider ways to support and preserve characteristic local shops, restaurants and brands," said Helen Mak Hoi-lun, senior director of retail services at property consultancy Colliers International.
"If we do not take any action, we will gradually lose our attraction to visitors."
She said mainlanders increasingly preferred to go shopping in Europe and the United States for the latest or limited-edition international brands, rather than come to Hong Kong to shop as they used to in the first few years after the individual visit scheme was introduced in July 2003.
Online shopping is also gaining popularity on the mainland, diminishing Hong Kong's appeal as a shopping destination.
"At the same time, expensive retail rents have forced some long-established and distinctive local retailers and restaurants out of prime shopping districts or even to close down," Mak said.
"The variety of retail elements, which is so important for the sustainable development of a shopping destination, has gradually declined on these streets.
"I don't think we will lose mainland visitors suddenly, but it may happen at a faster pace than people expect. If we do nothing, it will have a negative impact on retail rents and prices."
Mak said international brands were still interested in expanding in Hong Kong.
"However, we have more clients opening shops in Shanghai and Hong Kong at the same time, instead of opening a store in Hong Kong first," she said.
According to Colliers' Hong Kong retail rental index, retail rents in first-tier locations - Queen's Road Central and Russell Street in Causeway Bay - jumped more than 400 per cent between 2002 and 2012.
Joanne Lee, manager of research and advisory at Colliers, expects the average rent of street-level shops in the four major shopping districts - Central, Causeway Bay, Mong Kok and Tsim Sha Tsui - to grow a further 8 per cent this year.
Mak said: "The rental growth is supported by the increasing number of tourists. But it will be first time rental growth has narrowed to single digits since 2010."