A new trend has emerged in Hong Kong’s commercial property landscape as the retail sector slowly recovers: non-food and beverage (F&B) brands are turning to casual dining to entice young consumers and get more out of their premises.
Japanese apparel retailer Uniqlo carved up some space for a cafe in its refurbished Cityplaza outlet in Taikoo Shing last year and American luxury brand Ralph Lauren went further by opening standalone Ralph’s Coffee shops in high-end malls like Harbour City in Tsim Sha Tsui and Pacific Place in Admiralty.
French fashion houses Dior and Louis Vuitton had also opened pop-up cafes in recent years and months, while online brokerage firm Longbridge opened a Longbridge Cafe in Mong Kok late last month.
“Non-F&B brands in the Asia-Pacific, especially luxury fashion brands, have included cafes in their business to connect with young consumers and excite them with a new experience,” said Nathanael Lim, insight manager for beverages in Asia at market research firm Euromonitor International. “Cafes are popular among young consumers and are used as a marketing tool to drive consumer traffic to their luxury fashion store.”
The outlook for retailers has brightened after official data showed overall sales in August rose by 3.8 per cent year on year, marking a fourth straight month of growth.
It followed 14 consecutive months of decline from March 2024 to April 2025, with the August figure the highest since December 2023 when sales soared by 7.8 per cent.
Affected by the sluggish sales, rents of shops in Hong Kong have fallen from their peak. On average, rents in the city’s four core shopping districts of Causeway Bay, Central, Mong Kok and Tsim Sha Tsui had fallen by 29 per cent to 47 per cent between 2019 and 2023, according to Cushman & Wakefield.
In the first half of the year, high street rents were 57 per cent below their 2014 high, according to data compiled by CBRE.
Moreover, with the vacancy rate in prime shopping centres hitting a record high of 10.5 per cent at the end of June, rents slipped 3.4 per cent, according to JLL.
With about 600,000 sq ft of new prime retail space scheduled for completion in the second half of this year, vacancy rates in prime shopping centres were likely to rise, dragging rents down by between 5 and 10 per cent this year, JLL added.
For Uniqlo, the strategy to launch Uniqlo Coffee was a way to “continuously elevate the in-store experience” and to “align with evolving consumer needs”, according to a spokesman.
“Uniqlo Coffee aims to complement customers’ shopping experience with its convenient location, comfortable and functional dining area, and a variety of drink and snack options,” he said.
Besides the Cityplaza store, Uniqlo is also set to launch Uniqlo Coffee in Kowloon in its revamped outlet at the Mira Place in Tsim Sha Tsui when it reopens on October 17.
“Under the koten keiei management philosophy, Uniqlo will continue to introduce new services to address the evolving needs of custo
mers in Hong Kong,” the spokesman said.
Koten keiei encourages individual stores to take responsibility for their own “vibrant local management” and become “a valued and necessary part of local customers’ lives”, according to the company.
With lingering global uncertainties, Euromonitor expects non-F&B brands to look for alternative ways to boost their sales.
“By establishing cafes, this is a first touchpoint to connect and attract more consumers into their physical stores and market their core business,” said Lim of Euromonitor. -- SOUTH CHINA MORNING POST
