Causeway Bay boasts world’s highest retail rents

Hong Kong’s Causeway Bay has seen a 34.9 per cent hike in rental values, overtaking Fifth Avenue in New York as the world’s most expensive place to lease retail space.

Causeway Bay lease rates have risen to US$2630 per square foot per annum – overtaking Fifth Avenue’s US$2500 per square foot, according to Cushman & Wakefield’s new report ‘Main Streets Across the World’.

Notwithstanding slowing economic activity, retailers continue to see Hong Kong as the ideal launching platform into mainland China.

“There has been the usual jostling for the top positions between Hong Kong and New York but of course the real message here is the unfaltering advance of the top global cities, fuelled by a shortage of supply and the interest of international brands,” said John Strachan, head of global retail services at Cushman & Wakefield.

Despite a slight deceleration in regional growth rate in Asia Pacific to 8.6 per cent compared with 12.2 per cent in 2011, occupier demand in the region remained robust, with retailers eager to tap into a generally younger but increasingly affluent middle-class.


Within Asia Pacific, Causeway Bay has widened the rental difference on second placed Central, also in Hong Kong, at US$1856 per square foot.

“The highlight of Asia this year was Hong Kong where we saw prime rents surge by 21.8 per cent as a result of a strong demand from diverse group of new international retailers and the scarcity of available space,” said Michele Woo, senior director, retail transaction services, Cushman & Wakefield.

Within Asia Pacific, Tsim Sha Tsui in Hong Kong was ranked third most expensive retail destination at US$1547 per square foot. Taking the fourth, fifth and eight place are Japan’s Ginza, Omotesando and Shibuya at US$1057, US$972 and US$634 per square foot, respectively.

South Korea’s Myeongdong and Gangnam Station in Seoul emerged as the seventh and ninth costliest retail destinations in Asia Pacific at US$686 and US$590 per square foot, respectively.

Meanwhile, Australia’s Pitt Street Mall in Sydney and Queen Street Mall in Brisbane are the sixth and 10th most expensive retail destinations within Asia Pacific at US$952 and US$476 per square foot, respectively.

While not on the top 10 most expensive retail destinations, prime rents in India rose by 12.5 per cent on the back of strong occupier demand across all sub-sectors, however, some retailers were increasingly favouring high street properties at the expense of shopping centres, evidenced by the 75 per cent increase in rents in Colaba Causeway in Mumbai – the highest increase globally.


You have 7 articles remaining. Unlock 15 free articles a month, it’s free.