(Bloomberg) -- Spanish fast-fashion label Mango has rented a 19,000-square-foot store in Hong Kong’s prime retail district Central, people familiar with the matter said, the latest in a slew of global brands returning to the shopping hub, lured by lower rent.
Mango’s new two-floor store will be at Asia Standard Tower on Queen’s Road Central, which has been left largely vacant since 2020 when its last long-term tenant, British brand Topshop, moved out, according to the people who asked not to be identified discussing a private deal.
The new rent is about HK$1.2 million ($154,000) a month, about 20% below the pre-Covid level and about 60% lower than the premises’ peak rent recorded around 2014, one of the people said.
Mango, which currently operates one store in Hong Kong, and Asia Standard International Group Ltd., which owns the location, didn’t immediately respond to Bloomberg requests for comment.
The return of Mango, which had downsized significantly in Hong Kong over the past few years, is the latest sign that global brands’ waning confidence in the city is coming to an end, helped by falling prices in what used to be the world’s most expensive real estate market. While local businesses continue to suffer from a slow recovery in the number of tourists and residents’ increasing appetite for traveling and spending elsewhere, major landlords in premium shopping districts are pinning their hopes on multinational brands to fill empty stores and prop up rents.
The city, which has relaxed visa rules to attract skilled workers, has seen an influx of middle-class residents from mainland China seeking to escape the country’s economic slowdown. The influx has helped strengthen local spending, reinvigorating Hong Kong’s appeal to global brands.
The new Mango store is located in one of the Central district’s busiest neighborhoods, with trendy brands like Lululemon just across the street and a short walk from the Central-Mid-Levels Escalator, a popular draw for tourists.
New World Development Co., controlled by billionaire Henry Cheng’s family, recently leased a 8,000-square-foot store in its high-end mall K11 Musea to Prada SpA, Bloomberg reported last month. Hongkong Land Holdings Ltd., the property arm of conglomerate Jardine Matheson Holdings Ltd., teamed up with tenants including Hermès International SCA and Louis Vuitton to invest $1 billion to upgrade the developer’s premium retail space Landmark in Central.
US-listed sneaker brand On Holding AG recently opened its first-ever store in Hong Kong in a trendy mall in Central owned by Henderson Land Development Co., the flagship developer of billionaire Lee Shau Kee’s family. Hysan Development Co. is revamping its Lee Gardens, a group of luxury malls in Causeway Bay, with tenants including Hermès, Chanel and Dior expanding their stores.
--With assistance from Shawna Kwan.
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