CAUSEWAY Bay was one of the busiest areas in the retail property market in 1992, in terms of cosmetic changes to its exterior and in terms of turnover. The opening of Vogue Alley in place of the long-standing Food Street and the redevelopment of the former Inland Revenue Department in Windsor House strengthened the shopping choices in Causeway Bay. Mr Percy Cheng, manager of the retail department of Ricacorp Properties, has forecast more changes in Causeway Bay with the opening of Times Square this year. Office accommodation, designer boutiques, exclusive restaurants and a cineplex containing four mini-cinemas will draw crowds and traffic to the area. Mr Cheng said owners of shops in Sharp Street East and Russell Street, which front Times Square were gearing up for the acceleration of rents and prices. A shop in Sharp Street East has been leased recently through Ricacorp Properties at $60 per square foot, with a possible selling price of $14,000 per sq ft. In the third quarter of 1992, a 1,000 sq ft shop space on Russell Street sold for $22 million, setting a precedent. Last month, a 900 sq ft shop space was put on the market for $24 million. Most of the shops have leases yielding a low return of only three to five per cent, but most owners and investors believe in exponential growth for the area after the completion of Times Square. Mr Cheng said the current optimism was real but cautioned investors on expecting a quick return. Currently, Sharp Street East was tenanted mainly by garages and printing companies, while Russell Street was traditionally a wet market. He said it would take one to two years for the neighbourhood to upgrade and for retail space values to recognise this. Until then, investors looking for medium-to long-term investment should look around for good bargains. Information supplied by RicacorpProperties.