Thanks to strong performance from Chinese and fast food shops.
The value of total receipts of the restaurants sector extended its climb after rising 10% YoY to a provisional estimate of $30.5b in Q1, according to figures released by the Census and Statistics Department.
In a breakdown, total receipts of Chinese restaurants increased by 10.9% in value and 7.8% in volume whilst total receipts of non-Chinese restaurants increased by 11.2% in value and 8.7% in volume.
Total receipts of fast food shops increased by 5.8% in value and 1.6% in volume. Total receipts of bars increased by 5.4% in value and 7.7% in volume.
Over the same period, the provisional estimate of the value of total purchases by restaurants increased by 8.7% to $9.7 billion.
However, the F&B sector continues to be wracked by one of the industry’s highest vacancy rates after racking up 12, 120 out of 74,040 registered year-end vacancies.
Whilst the high F&B vacancies could be seen as a function of soaring city rents, Michelle Chiu, director of retail department at JLL, noted that intense competition is the real culprit and the weeding out of concepts is nothing new to Hong Kong where food trends are quicker to change.
“As one of the foodie capitals in Asia, the Hong Kong F&B market is a sophisticated and dynamic one where dining trends are adopted very quickly,” she said.
Chiu cited how back in 2013 to 2014, most clients were looking for retail spaces were searching for at least 3,500 to 5,000 sq. ft. to open large-scale restaurants. Now, many operators are seeking smaller opportunities to house unique concepts with 1,200 to 1,800 sq. ft. being a sufficiently-sized space.
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She reckoned that there were only a few popular brands that exited the market in the last 12 months, with many new ones entering such as Tsukado Nojo from Japan, Xinrongji from and Shake Shack from the U.S. In addition, she expects many more international concepts to land in Hong Kong in the next six months.
Photo from Ilokaqnue - Own work, CC BY-SA 3.0
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