Who decides how much the mall will reduce rent

In the past six months, police forces have entered the country to enforce the law

Together with various forms of “renovation”, business in major shopping malls has been bleak. Rent reduction is a natural market response.

The situation of rent reduction in different shopping malls is different

Some are quite “human-friendly”, while others are accused of being unfriendly. For example, there are tenant complaints that Sun Hung Kai stated that “there will be no reduction in a fraction of a second”. At politically sensitive times, Sun Hung Kai responded promptly and appropriately, clarifying that there are rent-free periods and restructuring leases based on individual tenants’ circumstances, renewing or signing new leases, and adjusting rents in accordance with the latest market conditions.

In fact, both landlords and tenants open their doors to do business. Faced with the pressure of falling demand, they will have to reduce rents even if they are “not close to human beings.” In the face of market forces, under the competition of landlords and tenants, rents are not paid by a landlord.

Which shopping malls have reduced their rents more and which have fallen less depends on the nature of the shopping malls

The lease has a certain length of time, reflecting the expectations of the retail market in the next year and a half. There are two major problems facing Hong Kong retail. One is that social conflicts hinder doing business, and the number of tourists has dropped sharply. The other is that the Sino-US trade war has weighed on local income, and the economic situation in the Mainland is very negative. The former mainly affects ordinary daily consumption. As life returns to “normal”, it is not difficult to rebound in the short term. In the latter, luxury goods are the first to bear the brunt. Even if mainland tourists return to Hong Kong, they will not be as boring as before, and high-end consumption will not improve in the short term. Therefore, malls with a higher style will have a larger rent reduction than ordinary malls.


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