More international retailers opened shops in Hong Kong than any other city in the Asia-Pacific region last year.
Fifty-one retail brands set up shop in the city, according to a study by CBRE Global Research & Consulting, which monitored more than 300 new retail openings across Asia-Pacific in 2012.
"Hong Kong is a win-win-win destination for retailers, landlords and shoppers," said Joe Lin, executive director of retail services at CBRE Hong Kong. "Global retailers are attracted by Hong Kong's market maturity as they look to create brand awareness to facilitate their long-term expansion into China, while simultaneously benefiting from the significant direct Chinese spending in the city.
"Landlords welcome the influx of overseas brands as they look to bring novelty for shoppers and differentiate their malls and retail outlets," Lin said. "And for shoppers, Hong Kong brings the clear advantage of having no consumption tax, authentic goods, and a world-class shopping experience to suit any taste and budget."
The number of new retail brands to open in Hong Kong was almost double the number of new entrants to second-placed Singapore, which lured 27 new retail entrants last year. Third in the rankings was Tokyo, where 24 new retailers opened stores in the city, followed by Ho Chi Minh City, New Delhi, Beijing and Shenyang.
Of the new brands that came to Hong Kong last year, almost a quarter were luxury and business retailers. Mid-range fashion retailers expanded rapidly as well to account for 21 per cent of all new entries to Hong Kong.
"We saw a number of new leases in the non-top-tier luxury segment last year, with a significant increase in mid-range fashion and accessory retailers," Lin said.
"This suggests that the consumption pattern of mainlanders is beginning to shift from exclusively top-tier luxury products to the more affordable mid-range watches, jewellery, and fashion - highlighting a change in Hong Kong's retail landscape."
Although the retail leasing market would still be supported by robust tourist arrivals, retailers are becoming more cautious about expansion due to high rents and other uncertain market factors. CBRE expects Hong Kong's retail rents to grow by 8 per cent this year, with mid-ranged fashion newcomers to expand their footprints in the city.