Causeway Bay is to lose a popular pub and restaurant on Hoi Ping Road to an office development.
Landlord Hysan Development told more than 20 tenants of Sunning Plaza several weeks ago they would have to vacate the buildings in September.
The tenants, which include the Inn Side Out bar and restaurant and Italian restaurant Da Domenico, were given notice two months after Hysan announced its plan to raze the office building and adjacent Sunning Court and to redevelop the site into an office and retail complex, expected to be completed by 2018.
"We just renewed the leasing contract for another three years late last year. It was a sad day when we received notice," said JR Robertson, managing director of Inn Side Out's owner, the Elgrande Group, which owns, operates and franchises 17 restaurants and bars, 13 in Hong Kong.
Since finding another 4,000 sq ft ground-floor location in Causeway Bay would be "mission impossible", the firm hopes to persuade Hysan to allocate it space in the new complex.
It has hired a consultancy firm to conduct a survey of its customers to support its claim that the pub caters to a wide audience of faithful customers.
"The landlord thinks we are a sports bar catering mainly for men. But lots of young ladies aged from 25 to 35 come to our bar," Robertson said. "Our intention is to collect data like our customers ages, why they like coming here … We will present the data to the landlord."
Robertson said Inn Side Out generated "incredibly high sales" and he was told by one of Hong Kong's major beer suppliers that the pub was the biggest seller of its brand in the city. He would not reveal the rent, but it was "a lot".
The lease stipulates that tenants of the 30-storey Sunning Plaza office building and the 59 rental units of Sunning Court would not receive compensation if the landlord were to knock them down for redevelopment.
A Da Domenico employee said it would be a challenge to find alternative space in the area. "But this is Hong Kong and we have no choice," he said.
Mortgage brokerage firm mReferral, which occupies three floors at Sunning Plaza, said its lease was due to expire around September. "We still have sufficient time to look for new space," its chief economist, Sharmaine Lau Yuen-yuen, said.
The group's Midland Finance also leases a floor. Other tenants are Yahoo, Amway, Grant Thornton, Asia Satellite Telecommunication and Clear Media.
Colliers International executive director Simon Lo Wing-fai said finding alternative space in the area would be a challenge, as the vacancy rate in Causeway Bay and Wan Chai was 4.5 per cent.
"Office rentals in Causeway Bay are rising and the tenants will have to pay higher rents when they move," he said. Market sources said office rents at Sunning Plaza were around HK$48 per square foot per month.
A Hysan spokesman said: "We are maintaining communication with the tenants and trying to sort out appropriate solutions for everyone."
Hysan deputy chairman and chief executive Lau Siu-chuen said in early March that the redevelopment would increase gross floor area by 25 per cent, producing an extra 90,000 to 100,000 sq ft of space.