NewHang Lung says luxury brands at its mall in Shanghai double retail space
Shopping mall investor says that despite slowdown and crackdown the mid-range retail market not a target as top-end brands still want quality
Hang Lung Properties, which focuses on investment in luxury shopping malls on the mainland, has no plans to shift to the mid-range retail market as top global brands are still seeking quality properties.
In contrast to luxury brands' call for rent cuts as sales in Hong Kong and the mainland dip, the developer said, international designer labels at its top-end Plaza 66 Shanghai shopping centre have doubled the size of their stores in the past two years.
"We have seen a rapid change in the mainland retail industry as consumer spending weakens. Five department stores in Tianjin have reinvented themselves either into office space or changed hands since September (last year). But we are not going in that direction," said chairman Ronnie Chan Chichung after the firm's interim results yesterday.
Hang Lung would benefit from the latest trend as there would be fewer competitors in the top-end mall space.
"If Prada wants to enter a city outside Shanghai and Beijing, I can say it will not [find] more than two malls [with international design standards] able to meet its requirements," he said.
Given Hang Lung's portfolio of seven completed luxury complexes in Shanghai, Jinan, Shenyang, Wuxi and Tianjin, he said he saw no reason for the firm to change its market position- ing. Others malls are being built in Dalian, Kunming and Wuhan.