A government pilot study into developing underground spaces in four prime locations in Hong Kong could help attract new entrants into the city’s retail market, according to industry experts, as increasing supply could lower rents. But analysts suggested providing connectivity between the subterranean spaces and facilities such as MTR stations and existing shopping malls would be paramount if the concept of an “underground shopping area” was to succeed. Government floats below-ground proposals for Hong Kong’s built-up areas “Location, location and location is the main concern for retailers. The government’s study could boost the development of the retail and tourism industry,” said Terence Chan, head of retail at JLL. The development of underground spaces could provide retailers with a cheaper alternative to renting a ground-level shop, he said. In his blog, Secretary for Development Paul Chan Mo-po revealed that the pilot study was looking into the potential development of underground spaces in Tsim Sha Tsui West, Causeway Bay, Happy Valley, Admiralty or Wan Chai. An “all-weather” walkway underneath Kowloon Park connecting the West Kowloon Cultural District, Tsim Sha Tsui and Tsim Sha Tsui East is an option being considered, according to Paul Chan. “The concept will divert passenger flow away from ground level and create new spaces to accommodate different facilities,” he said. The study was conducted by the Civil Engineering and Development Department and the Planning Department in June last year. Paul Chan pointed out in his blog that other cities such as Tokyo with its underground shopping malls and Finland’s Kamppi Centre with its long-distance traffic terminal below ground level provided valuable insights about increasing the amount of liveable area in a densely populated city like Hong Kong. Terence Chan said Tokyo’s success in operating underground retail malls was attributed the fact that it provided accessibility and connectivity to railway stations. “The mall has to let shoppers come in and out conveniently,” he said. “It will secure a stable daily traffic footfall.” An isolated underground retail mall will be unlikely to succeed Helen Mak, Knight Frank For instance, he said the proposed development of underground spaces in Tsim Sha Tsui would be most effective if it connected to the nearby established shopping malls in Harbour City. Helen Mak, head of retail service at property consultant Knight Frank, shared Terence Chan’s views. “An isolated underground retail mall will be unlikely to succeed,” she said. She recalled the former Palace Mall, a 150,000 sq ft underground mall in Tsim Sha Tsui, which had closed due to a lack of connectivity with MTR stations and other shopping centres. “Only a few shoppers were willing to visit the Palace Mall even though it was in Tsim Sha Tsui,” she said. She hopes banks and other service providers, attracted by the lower rental costs, may be interested in opening outlets in underground shopping spaces. “But major brands or fashion chains that can afford to pay higher rents will still want to have their stores on ground level,” she said.