Skechers, an American footwear and apparel company, is taking advantage of a slump in Hong Kong’s retail market by filling a space previously occupied by high-end Swiss watchmaker Patek Philippe on Causeway Bay’s Russell Street, one of the city’s most expensive shopping strips.
Advertisement
A 1,036 sq ft shop on the ground floor of 50-52 Russell Street was leased to Skechers for three years at a monthly rent of HK$360,000 (US$45,860), or HK$347 per square foot, according to Rickey Chan, managing director of Dorbo Realty.
Agents said Patek Philippe’s lease had it paying HK$550,000 a month, meaning Skechers was paying 35 per cent less than the Swiss watchmaker, though the monthly rent once surged to HK$1.86 million when the market was at its zenith.
In 2018, at the peak of the market, tenants along Russell Street, which stretches for 250 metres, paid as much as an average of US$2,671 per square foot in annual rent, beating global shopping strips like the Champs Elysees in Paris, Omotesando in Tokyo and Fifth Avenue in Manhattan, according to Cushman & Wakefield.
The Skechers lease was the latest shake-up in the tenant mix of Causeway Bay, one of Hong Kong’s four core shopping districts, as the city’s retail industry grapples with challenging economic conditions and the changing spending habits of locals and tourists.
Advertisement
In April, a local pharmacy leased a space at 22-24 Russell Street, previously occupied by the Italian luxury lingerie brand La Perla, at a 46 per cent discount from the previous tenant.