CBRE: Asian retail market remains stable

The regional retail market remained stable during the third quarter 2018, with major markets including Hong Kong, Japan and Korea reporting improving sales growth, according to CBRE. 

Leasing demand continued to be driven by F&B, led by bubble tea shops and coffee chains expanding in Hong Kong, China and Korea, although the competitive nature of the sector resulted in some closures during the quarter. 

Landlords are introducing more entertainment-based retail in shopping centers to increase consumer dwell time. Popular formats include cooking studios, indoor theme parks and games centers. 

Weak sales prompted several fast fashion retailers to close underperforming stores or exit markets altogether. Some landlords also sought to replace struggling apparel retailers with new tenants due to falling turnover rent income. 

Several luxury retailers have expressed concerns over business growth amid the uncertain geopolitical and monetary environment. 

Economic headwinds will ensure retailers remain cautious toward expansion despite the upcoming festive season. The weakening RMB may negatively impact sectors that rely heavily on Chinese tourist spending. 

To read the full report, click here.