More than 1,000 retail shops changed hands this year, with the average transaction amounting to HK$10 million, according to Sheraton Valuers. Managing director Michael Chik Pa-fai said about 80 per cent of the recorded deals involved small amounts. Shops at Mongkok, the busiest shopping area in Kowloon, achieved prices as high as HK$60,000 per square foot, he said. Most buyers were medium to long-term investors aiming to hold properties for at least two years. Transactions were widely spread around Hong Kong Island and Kowloon, he said. However, retail rental in Mongkok out-performed other areas with some small shops charging a monthly rate close to the 1997 peak, he said. Small shop units, measuring 100 square feet to 200 sq ft in prime locations achieved a monthly rate of between HK$600 and HK$800 per square foot. He attributed the sharp rise in rental to the short supply and the move to make some streets in the district pedestrian friendly. In April the Transport Department banned traffic from 4pm to midnight in Sai Yeung Choi Street South, between Nelson and Soy streets, to improve the environment. The move could help to increase the value of shops in those streets because more shoppers would be attracted, Mr Chik said. Some of the area's shop owners had increased their asking prices or rentals by 20 per cent. Retail rental growth slowed in the fourth quarter after seeing sharp rises since January, Mr Chik said. Cushman & Wakefield director Simon Chow said shops generally realised an annual return of about 8 per cent compared with 6 per cent for offices. The better return had attracted local investors. But foreign investors preferred to buy grade-A office and luxury residential properties, he said.