How will Occupy Central affect the retail sector in the long run?

Core shopping districts have already been disturbed.

The Occupy Central movement, which began in late September, caused some disruption to normal operations in certain core shopping districts.

According to a research note from Savills, however, it has been reported by a number of retailers including Luk Fook Jewellery and Sa Sa that the adverse impact on their shops in affected areas was mitigated by positive growth in sales in other districts because of a shift in spending patterns.

The actual impact of the event on the overall retail sector will be refl ected in the official government data for October, due to be released in early December.

Looking ahead, we believe that the impact of the recent demonstrations on the retail sector should only be temporary, with the situation gradually normalising after the protests end.

Here's more from Savills:

However, the weakening of the luxury sector due to the slowdown of mainland demand is expected to last into 2015.

We expect to see a further rental correction in the prime street shop sub-market over the remainder of 2014 and the first half of 2015, especially in second- and third-tier locations.

Overall, prime street shop rents are expected to decline by 5% to 10% over the next six to nine months.

The shopping centre segment will be less affected and remain relatively strong – it is expected to see further rental growth in the range of 5% to 10% over 2015.