Hong Kong’s ‘next SoHo’, Tai Hang, throttled by rent rises as restaurants and shops shut

Community of older walk-up residences and independent businesses shows a Hong Kong in flux, with flashy new apartment towers where few people seem to live, and rent increases driving out commercial tenants

PUBLISHED : Friday, 01 July, 2016, 6:00am
UPDATED : Friday, 01 July, 2016, 6:00am

Long-time residents of Tai Hang use the term kai fong to describe the neighbourhood, in recognition of its community spirit. Neighbours chat and patronise local businesses, from corner grocery store Ming Kee, which is more than 40 years old, to the even older Bing Kee, a dai pai dong.

“When I grew up here, everyone helped each other out,” recalls Tina Sin Sau-hing, 62, whose family lived in a shack on the hillside of Tai Hang, a village to the southeast of Causeway Bay, until she was 18 years old.

When a typhoon swept in, they would run from the hillside to shelter in a stairwell and wait out the storm. Her family were so poor she had to leave school in her teens to help out. With no running water, she carried buckets of water from a communal tap to sell to residents and shop owners. Such was the community spirit that even triad members came to her aid once when a troublemaker overturned her buckets.

Gentrification transforms Tai Hang, but at least one tradition remains

Although Sin moved to Tseung Kwan O 10 years ago, she and her sister still work in Tai Hang, where they have been selling flowers for the past 14 years, currently at a narrow stall called Wonderful Florist.

Best known for its annual fire dragon dance, Tai Hang also became a place Hongkongers liked to visit for a bite to eat at a reasonable price. Seven years ago, establishments such as Chaos Hot Pot and homestyle Chinese restaurant Man Sing heaved with diners.

An eclectic dining scene flourished amid car repair garages and pet supplies shops, including Japanese izakaya, Vietnamese, Indian and Mexican restaurants, and Western cafes for quality cups of java (not to mention a Hello Kitty Cafe). As the neighbourhood began showing signs of gentrification, there was even talk it could become the next SoHo.

In the past few years, however, Sin has seen many businesses closing, blaming landlords for steep increases in rent.

“Before, the rents here were reasonable and business owners could afford them, but now, the rents are so high … I’ve seen over 10 businesses close this year, and because of that fewer people visit the area,” she says. “There was a robbery recently at around 10pm. If there were more shops open, it wouldn’t have happened because there would have been more people around.”

Ted Lam Pak-kwan, 33, opened Chaos Hot Pot on Wun Sha Street seven years ago, serving quality ingredients to a clientele that included senior investment bankers. In the past six years, his rent has increased four times, and with the resulting closure of restaurants, Tai Hang has lost its lustre, he says.

“It used to be the place where people would go to look for restaurants and cool places to hang out. The peak was from 2011 to about 2013, when on Friday nights it would be impossible to drive into the neighbourhood because it was so packed.”

Lok Fu, corner of Kowloon that encapsulates Hong Kong’s history

Lam’s restaurant, and Man Sing,were once so popular that they put tables on the street for al fresco dining. Then, acting on complaints, the authorities put a stop to it, which also impacted their businesses.

Although Lam has refused to compromise on quality, he has cut the number of ingredients served for hot pot, and added less expensive dishes to the menu, such as a popular chicken hot pot.

The average bill per person before 2013 was HK$450 per head, he says; now it has been slashed to HK$250. It’s more “neighbourhood friendly”, but the bankers still come, he says.

When rents go up, business owners have to be prepared to earn even smaller profit margins, Lam says. “You have to bump up prices in order to pay the rent, but you can’t do that without better service, food quality and renovation. For places like cha chaan teng, there’s only so much you charge for milk tea or a bowl of noodles.”

For the past 10 years, Trudy Lau and her younger brother have owned the oddly named New York Club, which serves a mishmash of Thai, Vietnamese and Shanghainese dishes, as well as braised pork knuckle and even hot dogs. The restaurant used to be on Brown Street and, if it was very busy, she’d let diners eat upstairs in her living room. But the landlord raised the rent so much she was forced to move to a quieter spot at the end of School Street.

“We’re lucky we have been in business here for several years because over 90 per cent of our clientele are regular customers. Not many people walk down this street and just find us,” says the former nurse. “If you start a business here now, it’s really hard to build clientele.”

She points across the road to a shuttered dog grooming shop called Hearty Paws, which has been vacant for a year. Young people with money had opened it for fun, but there were barely enough customers to pay the rent and it shut down in less than a year.

Lau’s former landlord is a Mr Chow, who is in his 60s and who she says owns numerous properties in Tai Hang. When business was booming a few years ago, she recalls, Chow would drive around Tai Hang to see how busy the restaurants in his properties were. “Nowadays he doesn’t dare come near here,” Lau says.

She adds the last straw for her was the closure of Hong Kee in May. Run by two brothers, it had sold congee in the neighbourhood for more than 40 years. Lau says Chow owns the space and raised the rent so much that the business was no longer financially viable. Besides, the older brother wanted to retire.

“We have many elderly people in the neighbourhood who can’t afford to eat much, and congee was their only option. Now what are they going to eat?” she says.

“Our location is not very close to the MTR, and we are dependent on the weather. If it’s raining, too hot or too cold, people don’t want to come to Tai Hang,” Lau says.

Chow’s office refused to comment on the rental situation in Tai Hang when contacted by the Post.

“We should compile a list of landlords who jack up the rent, and the addresses of the places they own so that people know not to patronise those places,” Lau says angrily. “That is the only way to get them to lower the rent.”

There are rumours that the congee shop will reopen in a few months – next door to the original location – in a space not owned by Chow.

three apartment blocks have recently sprung up in Tai Hang, including The Warren and WarrenWoods, where the going rate for a two-bedroom, 570 sq ft flat is about HK$11 million. The most recent development is Little Tai Hang, with restaurants including Bond, serving Western comfort food, and a craft beer place called Second Draft. Above are serviced apartments that will open in the autumn.

Newly opened Little Tai Hang in Tai Hang serves upscale comfort food

Although these new flats signal a future influx of residents, florist Sin is unimpressed.

She points to the two-year-old WarrenWoods development. “See? So many of them are pitch dark. The lights are not turned on, so although they’ve been bought no one occupies them. That doesn’t help us businesses at all.”

Lau is tired of seeing shop spaces in Tai Hang that have been empty for over a year because it affects her business too. “But landlords aren’t willing to lower the rent just so the shops will be occupied.”

There is speculation that Chow has further designs on the neighbourhood. He owns more than 25 per cent of the retail space in Tai Hang. Ironically, while rents have risen steeply, with shop spaces vacant for a long time property prices have begun falling.

For now, the once happy kai fong may see more restaurants closing, but Lam is optimistic, believing the economy may have bottomed out.

“It can’t be worse than this. Tai Hang won’t die. It will survive, but there will be fewer places with interesting and good ideas.”