In a significant move reflecting the evolving retail dynamics, luxury department store operator Harvey Nichols announces its exit from the landmark mall in Hong Kong’s Central district. The decision is driven by shifting shopping trends, with declining spending from both Chinese tourists and local shoppers impacting the viability of the 60,000 sq ft space operational since 2005.
Harvey Nichols, under the ownership of Dickson Concepts, will relinquish its lease in March, marking the end of almost two decades in the Central district. Speculations suggest monthly payments of up to US$1.57 million for the five-storey space. Notably, Harvey Nichols remains committed to the Hong Kong market, maintaining its presence in another location, Pacific Place, opened in 2011.
Dickson Poon, executive chairman of Dickson Concepts, points to changing dynamics, noting that Chinese tourists visiting Hong Kong are no longer as shopping-focused. Weaker-than-expected spending during Golden Week holidays in May and October further emphasizes this shift. Additionally, local consumers increasingly choose to travel abroad during festive seasons, reducing the necessity of operating multiple large department stores in close proximity.
Despite challenges, Dickson Concepts reports positive financial performance. In the six months ending September 30, the parent company records a 26.1% revenue increase to HK$1 billion, defying weak consumer sentiment. Net profit attributable to equity shareholders rises significantly by 41.5% to HK$219.7 million. Sales in Taiwan experience an 8.5% rise, with profits up by 23.4%, while sales in China witness an impressive 32% growth.
Harvey Nichols’ strategic move underscores adaptability to changing consumer behaviors, reflecting the brand’s commitment to navigating the evolving retail landscape.
