Retail rents to further decline in 2026, says JLL

JLL expects vacancy rates to stay high in 2026 as closures outpace new take-up.

Hong Kong retail rents are expected to continue falling in 2026, with vacancy rates likely to stay elevated amidst ongoing rental corrections, according to JLL Hong Kong.

In 2025, rents at Prime shopping centres and High Street shops fell by 9.1% and 7.7%, respectively.

Tenants have upgraded to prime locations, and new players are entering the market to take advantage of the lower rental levels, although leasing activities remain concentrated in prime districts such as Causeway Bay and Central.

The change in dinning preferences and heightened regional competition has prolonged restructuring in the F&B sector. Receipts from non-Chinese rose by 3.9% YoY in the first three quarters whilst Chinese restaurants dropped by 4%.

"Despite closures among long-established F&B operators, demand from tenants seeking upgrades and new entrants remain resilient. Leasing activity is expected to stay robust next year, underpinned by further rent softening.”, said Jeannette Chan, Senior Director of Retail at JLL Hong Kong.

“Vacancy rates are likely to stay elevated, as closures outpace new take-up in 2026 amid a weak employment outlook and persistent imbalance between outbound and inbound travel," she added.