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Shanghai shopping malls poised for surge of new tenants chasing post-pandemic ‘revenge spending’ spree
- At least 13 global chain-store operators have already set up or plan to open their first mainland Chinese shops in Shanghai this year
- China’s exit from its zero-Covid strategy will unleash pent-up demand for packaged food and personal-care products, according to a study
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Daniel Renin Shanghai
Owners of shopping malls in Shanghai can expect a rebound in occupancy rates as retail and catering brands step up to tap a wave of “revenge spending” now China has abandoned its harsh Covid-19 pandemic curbs, analysts said.
At least 13 global chain-store operators have already set up or plan to open their first mainland Chinese shops in Shanghai, the country’s commercial hub, this year, betting that the country’s reopening after three years of restrictions will spark a spending spree on food, clothing and cosmetics.
“In 2023, a strong recovery of shopping activities will be seen from the second quarter,” said Sherril Sheng, research director for the residential sector at JLL China. “More lease agreements will be signed as new-energy vehicle, personal care brands, garment makers and outdoor sportswear companies look to open new stores.”
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The new signings will eventually boost the occupancy rate in the city’s major shopping streets, she added.
In 2022, lockdown measures and standstill orders to restrict people’s movement caused occupancy rates in the city’s shopping arcades to increase by 1.3 percentage points to 8 per cent, according to data provided by CBRE.
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Shopping mall ceiling collapses in China
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Average rental costs for retail space at ground-floor level in the malls dropped 3.1 per cent on the year to 34 yuan (US$5.02) per square metre per day.
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