Buyers call the shots as shop owners in Hong Kong’s SoHo entertainment district accept rock-bottom prices
- The 168 transactions for shops in the first quarter is the worst on record since Midland IC&I started tracking deals in 1996
- Shop owners in SoHo are willing to offer discounts of up to 50 per cent rather than let their properties sit empty
“Unfortunately, it is not that easy to find buyers,” said Daniel Wong, chief executive of Midland IC&I, adding that potential buyers were looking for at least a 30 per cent discount. He said it only was reasonable because it is difficult to lease the shops out currently and the rents buyers can ask have fallen. “In some cases, the new buyer may have to wait for a while to find a new tenant if the shop is not sold with a lease.”
First hit by Hong Kong’s anti-government protests, then the Covid-19 outbreak which led to the government’s social distancing policy, requiring restaurants to only open at half their capacity, many bar and pub owners in SoHo had no choice but to shut shop.
A 1,000 square feet space in Elgin Street, which housed a restaurant that has since closed, was recently sold for HK$34 million (US$4.4 million), about half the asking price from a year ago before the city’s retail businesses were hit by the months-long social unrest starting in the middle of last year followed by the ongoing coronavirus outbreak.
