The Link Real Estate Investment Trust will continue to buy mostly retail properties, although its shareholders have endorsed an expansion of the range of assets it can acquire. "I think our skill set is really in retail," George Hongchoy, chief executive of The Link Management, which manages the reit, told the South China Morning Post . "Our landlord-tenant relationship is with retail tenants, so when we look at certain properties, we would say that it should be predominantly retail." During The Link Reit's annual meeting last year, shareholders of the investment trust, which owns 182 retail and car park facilities in Hong Kong, approved an expansion of the scope of the asset classes it could buy to other types of commercial properties, such as industrial buildings, warehouses and mixed-use buildings. "Even if we look at an office building, our focus would be on those buildings where you have retail activities up in the office building," Hongchoy said. "Imagine going to some of the districts in Hong Kong [with such buildings]. You go up to the 12th floor, you will have a travel agent. If you go to the 15th floor, you have a beauty salon and dentist. All these are really retail activities, so we may look at those sorts of properties. But we are not going to buy an office building where people really go there as an office." Hongchoy said that asset acquisition was one of the three prongs of The Link's business strategy, alongside asset enhancement and management. He said that the reit had a "fairly low gearing" of about 15 per cent. If it gears up to about 30 per cent, he said, it can spend about HK$20 billion, which can buy a lot of properties. The Link made two acquisitions after its listing in 2005, including the commercial portion of Nan Fung Plaza in Tseung Kwan O for HK$1.17 billion, and neighbouring Maritime Bay for HK$588.4 million in 2011. Unlike street-level shops, which have become so expensive that the rental yield has dropped to about 2 per cent or less, Hongchoy said shopping centres trade at a higher yield of about 4 per cent to 6 per cent. He said The Link's portfolio would still focus mainly on properties with tenants in non-discretionary businesses such as supermarkets, food stores and education-related businesses, although it might seek to buy properties that focus on other types of trade mix. "The reason for that is if you consider the volatility in the market, non-discretionary trade is a lot more stable," he said. Unlike luxury shops, Hongchoy said, the reit's tenants had not experienced a drop in retail sales. "It may not go up as much in a very strong market, but at the same time it won't go down that much [during a market downturn]," he said. As The Link has been renovating its malls gradually, property analysts Patrick Wong Chi-leung and Lee Wee Liat said in a recent BNP Paribas report, it has attracted more tenants, including chain stores offering personal care and medicinal products. For example, Sa Sa International and Beijing Tong Ren Tang, which usually open street-level shops, have moved to The Link's malls, as rents of high-street shops have climbed too rapidly in recent years. The Link Reit's share price rose 0.54 per cent on Friday to close at HK$45.35.