BGC, Philippines– Prada is set to make a significant retail expansion in Hong Kong by opening an 8,000-square-foot store in K11 Musea, a luxury shopping mall developed by New World Development Co. This new two-floor store marks Prada’s first major launch in the city in several years.

The construction of this new store will commence shortly, with an expected opening early next year. According to sources familiar with the matter, the rent for this store is likely to be partially based on its sales performance. This move comes after Prada shut down its flagship store in Causeway Bay in 2020, which was one of the city’s most expensive retail leases with a monthly rent of HK$9 million ($1.2 million). At its peak, Prada had nine outlets in Hong Kong, but currently operates six.

Prada’s decision to open a new store in Hong Kong reflects a broader trend among global luxury brands returning to the city’s core business districts. These brands are attracted by property prices that remain significantly lower than pre-pandemic levels. For instance, in Tsim Sha Tsui, where K11 Musea is located, average rents for major shopping streets are still 45 percent below 2019 levels, according to Cushman & Wakefield Plc.

The move by luxury brands to re-establish their presence in Hong Kong comes despite years of social unrest and a slowing economy. High-end shopping malls in the city have been enhancing their luxury appeal to attract affluent consumers. New World, led by CEO Adrian Cheng, even collaborated with Louis Vuitton to host the brand’s first-ever fashion show in Hong Kong last year, held just outside K11 Musea.

Hong Kong’s wealthy residents have provided a measure of stability for global luxury brands amidst a sales slump in mainland China. The city continues to be a popular destination for mainland tourists, further boosting its retail sector.

In addition to Prada’s new store, other significant investments are being made in Hong Kong’s luxury retail landscape. Hongkong Land Holdings Ltd., along with tenants like Hermes International SCA and Louis Vuitton, is investing $1 billion to upgrade its flagship retail space, Landmark, in Central. Similarly, Hysan Development Co. is revamping Lee Gardens in Causeway Bay, with expansions by tenants such as Hermes and Chanel.

Prada’s return to opening new stores in Hong Kong signifies a rejuvenation of the city’s luxury retail sector, positioning it once again as a prime location for high-end brands looking to cater to affluent consumers and capitalize on the lower property prices.

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