Global Brands Fila, Panerai, and Armani Seize Opportunity Amid Hong Kong’s Retail Vacancy Surge: A New Era of Innovation in Retail

Large retail spaces in Hong Kong have been acquired by Fila, Panerai, and Armani amid ongoing high vacancy rates. Given that rental prices are currently up to 65% lower than their peak rates, brands from Europe, the US, and Japan are seizing the opportunity to establish a significant presence.

In the four main commercial areas of the city – Causeway Bay, Central, Mong Kok and Tsim Sha Tsui – the third quarter saw between 8.9% and 15.4% of stores unoccupied, a rise from the 6.8% to 12.8% recorded in the first quarter, as reported by Midland IC&I. The commercial real estate firm predicts a slight uptick in these vacancies in the first quarter of 2025, with rates forecasted to be between 9% and 16%.

In the past three months, various luxury and mid-market brands from America and Europe have committed to pricey rental agreements, taking advantage of the significant decrease in rents, which have dropped by up to 65% from the record highs of 2019.

"Empty storefronts are potential prospects," stated Lieman Leung, the head of Midland Shops. "New businesses launching in Hong Kong have the chance to bring in unique business strategies, inventive ideas, and more imaginative items to the regional market."

The sportswear company Fila, based in Seoul, has rented multiple stores in Hollywood Plaza, Mong Kok, covering a combined space of 5,643 square feet for HK$1.8 million (US$232,000) per month. Panerai, an Italian luxury watchmaker, has agreed to a monthly rent of HK$1.7 million for a 9,182 square foot store in the Pacific Star Building in Tsim Sha Tsui. American fashion retailer Abercrombie & Fitch has secured a 7,000 square foot location in Hysan Place, Causeway Bay, for HK$1.5 million a month. Meanwhile, Spanish fashion label Mango is set to take over a 19,071 square foot store on Queen’s Road in Central for HK$1.25 million monthly.

The esteemed Italian high-end brand Armani has acquired an additional store on Queen's Road in Central, offering 6,000 square feet of retail space, at a rate of HK$800,000 per month. Simultaneously, Hollister, another US fashion retailer, has opted for a 10,000 square foot space in New Town Plaza in Sha Tin for HK$1 million per month. Meanwhile, the Swiss Swatch group is set to shell out HK$400,000 monthly for a 1,000 square foot store in Mira Place, located in Tsim Sha Tsui.