Prada sister brand Miu Miu has snapped up a prime Tsim Sha Tsui site after LVMH’s Marc Jacobs made an exit to reduce its rent bill.
The switch is one of a growing number of surprise moves in the city’s retail real estate market as luxury brands reconsider their store requirements in a market suffering from declining luxury spending by visiting Mainland Chinese tourists. In recent weeks realtor CBRE has reported an increase in the number of lease surrenders in the retail sector.
Last month Adidas took over a space vacated by Coach’s flagship in Central and Colourmix said it had signed up for space in Russell St, Causeway Bay, previously occupied by watch brand Jaeger-LeCoultre. Adidas paid 23 per cent less rent than Coach paid, and Colourmix 43 per cent less than Jaeger-LeCoultre.
The differences in rent on the Tsim Sha Tsui site has not yet been revealed. But Michael Chik, MD of Sheraton Valuers said in an interview with the South China Morning Post that he expected upcoming Canton Rd lease renewals would be signed at a discount of about 30 per cent on the previous terms.
“When there is vacant shop, landlords of shops on that street will feel the pressure,” said Chik.
But he said there would be no shortage of prospective tenants in prime areas.
The new Miu Miu shop, in Harbour City, will open next month.