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South China Morning Post
05-07-2025
- Business
- South China Morning Post
CY Leung renews call for Hong Kong landlords to cut rents amid rising vacancies
Hong Kong's former leader Leung Chun-ying has challenged landlords to 'adjust their mentality' over rental yields as he renewed his call for price cuts to stem a 40-year high vacancy rate for commercial properties from rising further amid a slackening economy. Leung, now a top political adviser to the country, also warned that landlords would be harmed in the end if they refused to budge on lowering rents. 'It is sheer self-delusion if landlords think they can get the rent level they want by leaving the premises vacant and waiting [instead of cutting the rents],' Leung said on Saturday. Leung, now a vice-chairman of the Chinese People's Political Consultative Conference, weighed in on the debate over Hong Kong's commercial rents last week after the latest government report showed that, by the end of 2024, the total vacant floor area of private commercial buildings reached 1.4 million square metres. The empty space represented a vacancy rate of 11.8 per cent – a record high over the past 40 years. The slackening economy has also resulted in a string of high-profile shutdowns of established restaurants in recent months, with some citing high rents as a reason. 'The overall economic environment is like that now. Perhaps it is partly because people are going north to spend, or people are getting used to buying takeaway, or shopping online,' Leung said.
South China Morning Post
03-07-2025
- Business
- South China Morning Post
As more Hong Kong restaurants close, landlords must cut rents
Vicious cycles are difficult to break. As Hong Kong scrambles to identify and chip away at factors behind a wave of closures in catering and food production, lowering commercial rents may be a logical next step. A recent high-profile victim of the spiral was City'super's Amazing Food Hall in the upscale Times Square shopping centre and office complex where the company opened its first flagship store in December 1996. Advertisement The pricey yet popular venue was the company's final food court before it closed on June 30. City'super cited changing consumer patterns as a reason for the closure. Struggling retailers have been told to reinvent their offerings so they can better compete, but it is increasingly clear that alone will not be enough. Former Hong Kong leader Leung Chun-ying is among those urging landlords to lower rents. He noted that the city's commercial property vacancy rate was at a 40-year high of 11.8 per cent at the end of 2024 and many building owners have loans tied to the valuation of their properties. But Leung said rather than let space sit vacant, landlords must 'face the reality' and procrastination would 'only make businesses dry up'. Advertisement The Hong Kong Retail Management Association said landlords were generally willing to discuss lease renewals, but retailers find most offers insufficient. The Hong Kong Federation of Restaurants and Related Trades said some landlords had reduced rents, but operators still face much higher costs than their mainland counterparts.
