Retail rents in Hong Kong are expected to grow at a more moderate pace of about five per cent this year, says Jones Lang LaSalle.
In its new report, the firm says the limited availability of retail space and consequently high rents in prime shopping districts continue to challenge cost-sensitive retailers, many of whom are no longer able or willing to commit to paying higher rents.
Retailers' growing reluctance to chase higher rents led to a moderation of rental growth in the first quarter, and prompted an increasing number of them to expand and open new outlets on fringe streets with lower rents.
Jones Lang LaSalle says more and more visitors are opting for a "day trip" visit to new and emerging shopping districts, including Sheung Shui, Yuen Long, Tuen Mun and Sha Tin.
According to Jones Lang LaSalle's data, the number of day-trip mainland tourists, or "day trippers", grew 37 per cent to 20 million last year.
With average individual spending of HK$2,000 to HK$6,000 per trip, these tourists have drawn the attention of local and international brands, resulting in higher sales and growing demand for store locations in the emerging shopping districts.
Tom Gaffney, head of retail at Jones Lang LaSalle Hong Kong, said: "While there are still market uncertainties ahead, we believe that a vibrant inbound tourism, largely healthy job market, and retailing opportunities in new and emerging shopping districts on the back of rising day-trip tourism should continue to lend support to the retail sector for the rest of the year."