Hermes expands in Hong Kong betting on return of luxury shoppers
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Hermes currently has seven stores across Hong Kong, including its flagship in Central.
PHOTO: REUTERS
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Hong Kong - French luxury giant Hermes International is expanding its store in one of Hong Kong’s most high-end shopping malls, adding to signs that premium brands are renewing their focus on the city as an economic slowdown weighs on the outlook for China.
The three-floor store in Causeway Bay’s Lee Gardens is undergoing renovations and is expected to reopen around mid-year with a much larger area, according to people familiar with the matter. As part of the expansion, Hermes has taken over a neighbouring store on one floor, they said.
The shop will have an expanded offering of products including handbags and furniture, providing customers with better access to stock, one of the people said. Hermes currently has seven stores across Hong Kong, according to its website, including its flagship in Central.
Hermes’ bet on Hong Kong symbolises a broader shift under way for some of the world’s biggest luxury brands. After pouring investment and resources into mainland China to capitalise on a Covid-linked shopping boom, a property-market meltdown and surging youth unemployment has seen many consumers – especially the aspirational middle class and moderately wealthy – tighten their belts.
That’s renewed the allure of Hong Kong, whose large concentration of ultra-wealthy residents are viewed as better able to weather uncertainty.
Hong Kong has already been quietly staging a comeback, reclaiming its title as the world’s top luxury spender per-capita last year, according to data from Euromonitor International. It had lost its No. 1 position to Switzerland and the United Arab Emirates after months of social unrest in 2019, then three years of stringent Covid-19 restrictions, battered retail sales.
Other top brands are showing optimism about Hong Kong. Chanel last year rented a two-floor store in Causeway Bay for about HK$3 million ($512,500) a month, moving in following the slump in rental prices during the pandemic.
Meanwhile, Louis Vuitton, part of billionaire Bernard Arnault’s luxury conglomerate LVMH Moet Hennessy Louis Vuitton, opened a pop-up menswear store and cafe in January in the affluent Mid-Levels neighbourhood. The brand also hosted its first ever fashion show in the city in November. Fellow LVMH stable mate Dior is set to showcase its men’s pre-fall collection in Hong Kong in March. BLOOMBERG
