International luxury brands like Tiffany, Burberry are booming in mainland China as they struggle to survive in Hong Kong
- A government cut to VAT has led to a surge in sales and higher shop rental yields in mainland China, according to a senior industry executive
- Hong Kong’s economy is littered with reports of shop vandalism and closures as luxury brands have seen their sales tank amid protests
International fashion brands are enjoying a boom in mainland China, where a government cut to consumption tax has led to a surge in sales and higher shop rental yields, according to a senior executive at a major retail landlord.
Sales of some luxury brands have been growing up to four times faster in China than they have across the rest of the region, said Christina Hau Shun, assistant director and general manager for retail leasing and operations at Wharf China Estates, a wholly owned subsidiary of Hong Kong-based Wharf Holdings.
This has led to a healthy rise in rental incomes from shopping malls.
The situation is in stark contrast to Hong Kong where many high-end retailers have seen their sales devastated by six months of violent street protests, forcing them to request rental relief from their landlords.
“We have seen sales of some luxury international brands grow 200 per cent to 300 per cent higher than their overall performance in Asia-Pacific in the third quarter in my portfolio,” said Hau.
She manages a portfolio of 4.14 million square feet of investment properties, largely made up of four shopping malls – Chengdu IFS, Chongqing IFS, Chongqing Times Square and Dalian Times Square.