Li Ka Shing’s luxury mall in Hong Kong sits empty as Chinese spending plunges

In Hong Kong’s Tsim Sha Tsui district, the mock classical 1881 Heritage mall used to lure queues of mainland Chinese tourists eager to shop at boutiques operated by brands such as Tiffany, Cartier and Chopard.

Now it attracts neither crowds nor brands.

Only three of the more than 30 units at the mall owned by billionaire Li Ka Shing’s CK Asset Holdings are occupied and its colonnaded courtyards are quiet.

In nearby Canton Road, a shop previously rented by Swatch Group’s Omega for about HK$7.5 million (S$1.3 million) a month is leased to a bank for 80 per cent less, according to real estate agents familiar with the deal.

Over in Causeway Bay’s Russell Street, a Transformers-themed fast-food restaurant has taken the place of Burberry.

Its rent is 89 per cent below the HK$8.8 million the British firm was forking out in 2019, the agents said, declining to be identified because the matter is private.

China’s collapse in high-end spending has shaken investor confidence in luxury brands across the globe, as companies from LVMH to Richemont and L’Oreal report falling sales in the region.

Nowhere is the scale of that decline in demand more evident than in Hong Kong, which was for many years the favoured destination for China’s nouveau riche to splurge on designer handbags and Swiss watches.

“Hong Kong’s luxury market was once a paradise, but now it’s fallen into the abyss,” said Dr Edwin Lee, founder of Bridgeway Prime Shop Fund Management, which owns a portfolio of retail properties across the city.

“The days when tourists came to buy luxury products without thinking are gone.”

Official figures show fewer Chinese tourists are visiting Hong Kong than before the pandemic and those who are coming spend on average only half of what they used to.

The hoped-for recovery when the border between the city and the mainland reopened at the start of 2023 has not materialised.

Ref: Li Ka Shing’s luxury mall in Hong Kong sits empty as Chinese spending plunges (straitstimes)