King Fook Jewellery Group has signed a six-year lease for a 550-square-metre retail space at Pacific Place Phase II in Admiralty, Hong Kong, with the agreement set to begin on February 1, 2028. The lease carries a total base rent of approximately HK$268.5 million, or about HK$3.73 million per month, according to a company announcement filed with the Hong Kong Exchanges and Clearing on Monday.
The move to expand at a prominent luxury shopping centre comes amid a cautiously optimistic retail environment in Hong Kong. Industry analysts have noted that the steady rise in visitor numbers is supporting growth in sectors such as jewellery and watches, despite broader challenges faced by luxury goods markets.
Stanley Poon Chi-ming, managing director at Centaline Commercial, highlighted that many retailers in the jewellery and watch industry are increasing their retail footprint following a sustained recovery in visitor arrivals and retail sales. He added that the monthly rent agreed by King Fook is reasonable for an upscale location like Pacific Place, where a concentration of luxury brands generates significant commercial appeal.
Financial commentator Simon Lee Siu-po noted that retail sales in the jewellery, watch, clock, and valuable gift category in Hong Kong totaled HK$52.32 billion last year, equivalent to approximately HK$143 million daily. He said the estimated daily rent of about HK$120,000 for King Fook’s new store remains manageable, especially given recent declines in retail shop rents.
However, some experts express caution regarding the expansion. Terence Chong Taileung, executive director of the Lau Chor Tak Institute of Global Economics and Finance at the Chinese University of Hong Kong, pointed to challenges related to the current global slowdown in demand for luxury goods, including jewellery and watches. Chong estimated that King Fook would need to sell around 10 watches per day just to cover the rent, which he deemed a challenging target given economic uncertainties and slower growth in mainland China.
Recent government data provide a mixed but generally positive retail outlook for Hong Kong. While China’s total retail sales of consumer goods grew by just 1.1 percent year-on-year in the first eight months of 2024, Hong Kong’s sales of jewellery, watches, clocks, and valuable gifts increased by 11.9 percent in August compared to the previous year. Visitor arrivals to the city rose to 5.46 million in August, a 6 percent increase year-on-year and a post-pandemic record monthly figure. During the National Day “golden week” holiday, inbound mainland visitors totaled around 1.6 million, an increase of approximately 6.37 percent from the prior year.
King Fook confirmed that the new retail premises at Pacific Place will function as a single-brand watch boutique, reflecting the company’s strategic focus within the luxury segment.