Lu Zhanhao, Executive Director and CEO of Mei Lian Commerce and Business, Legend Upstar Holdings (00459.HK), stated after the shareholders' meeting that due to high interest rates and weak Hong Kong tourism industry, the commercial property market recorded only 371 registered transactions in the first five months of this year, a decrease of about 14.7% compared to the same period last year. However, the total registered amount of shop space increased by about 11.3%, showing a situation of "rising prices and falling volume", which is believed to be related to the many large-scale commercial property registrations in the market this year.
Looking ahead to the second half of the year, with the emergence of the "spicy withdrawal" effect, developers are selling new and surplus properties at low prices, which significantly improves the atmosphere of the property market and leads to an overall situation of "trading volume for price", which is bound to drive non-residential property transactions. In order to improve bargaining power, shop owners are adjusting property asking prices while the price difference in the shop market narrows. It is expected that commercial property transactions will pick up in the second half of the year. In addition, the influx of many Chinese or multinational dining brands is expected to contribute to rental growth, and it is estimated that core area shop rentals will increase by less than 5% this year.
Lu Zhanhao said that the commercial property rental market has resumed its activity this year, and many Chinese and multinational brands have taken advantage of the opportunity of falling rents from their peak to open businesses in Hong Kong despite the market trend. In particular, some dining brands see Hong Kong as a springboard for expanding their foreign business. In addition, as the Hang Seng Index and transaction amount rebound from their lows, he believes that financial institutions or related institutions will continue to expand the Hong Kong market and become a new driving force for the rental of Hong Kong commerce and business.