Operator of Hong Kong’s The Boxes mall near Shenzhen border scrambles to meet soft launch deadline after Christmas
Complex with unique design has been plagued by delays and only has 72 tenants out of 214 available lots
The operator of Hong Kong’s first, much-delayed, outlet shopping centre near the Shenzhen border is scrambling to meet a soft launch deadline after Christmas amid efforts to lure tenants.
Import and export sector lawmaker Wong Ting-kwong, who is behind the project, unveiled the plan on Monday for the opening of San Tin Shopping City, also called The Boxes.
Wong said 72 tenants, accounting for 40 per cent of the 126,000 sq ft rentable floor area, had signed a contract with the mall.
“So far the occupation rate is far from satisfactory,” he admitted. “But we will organise some trade fairs next week to attract more tenants. When we secure at least 50 per cent of the 214 slots, we will have a trial run. I hope to make it happen after Christmas but I can’t guarantee this.”
Wong said that an official launch for the pop-up shopping complex would be organised once more than 80 per cent of tenant lots had been secured, ideally before the Lunar New Year.
“We are confident we can attract enough tenants,” he said.
The mall operator has to apply for a three-year renewal from the Town Planning Board in March, as it is currently under a temporary land-use permit that will expire in September next year.
Wong pledged to assure tenants of a sound business future, with a 40 per cent rental discount in place until the permit renewal is approved.
The complex is intended to serve as an outlet mall with a dining area and fairs. An aggressive marketing campaign was launched after operators obtained an occupation permit from the Buildings Department last month. The project was plagued by repeated delays that spanned more than two years because of technical challenges posed by its design.
Wong came up with the idea several years ago to capitalise on the massive influx of mainland shoppers and traders who bought baby milk powder, cosmetic goods and other necessities in Hong Kong to sell for a profit across the border.
But anti-mainland sentiments in 2015 has since resulted in fewer visitors coming to the city for such activities. The trend was also part of a tourism downturn caused by the stronger Hong Kong dollar.
“We estimate that we can attract about 10,000 shoppers daily on weekdays and more than 10,000 during weekends after we officially launch,” Wong said.
Mall operator Well Operation has secured a HK$120 million bank loan. Its parent company, the San Tin Shopping City Foundation, is the guarantor. Wong is part of the foundation.
So far, cosmetic firm Bonjour, fashion company G2000 – owned by lawmaker Michael Tien Puk-sun – and a virtual reality game firm have signed up as tenants.
The rent ranges from HK$67 to HK$107 per square foot. Other features include booth games, a wishing well, rickshaws, a birdwatching area, a street art museum and live gigs.
Wong said that tenants were also concerned about the land lease. The 420,000 sq ft plot has been leased to the mall owner at a HK$1 nominal fee by Sun Hung Kai Properties and Henderson Land Development only until September. But tenants are encouraged to sign two-year contracts up to 2019.
“As long as the Town Planning Board renews our temporary land use permit for another three years, I am sure both Sun Hung Kai and Henderson will continue to lend this plot of land to us as this is a charitable project for the development of Hong Kong,” Wong said.
The complex is located in San Tin, Yuen Long. Its 214 shop spaces – reserved for restaurants, boutiques and electronic shops, among other retail businesses – are designed to look like individual containers.
There will be 600 parking spaces and a shuttle bus service of up to 100 trips daily between the Gangxia train station in Shenzhen and the mall.