Hysan, tenants prepare for economic headwindsBusiness | 13 Aug 2019 5:32 pm
Hysan Development (0014) chairwoman, Irene Lee Yun-lien, said Hong Kong’s economy is expected to face increasing uncertainties in the second half.
She said commercial tenants are in a wait-and-see mode.
She stressed the company will work with tenants and weather the storm together.
Hysan will maintain a prudent financial management policy and its commitment to Causeway Bay and Hong Kong remains unchanged, Lee said.
Hysan is a dual-engine business including office and the retail segments with the office segment accounting for 45 percent of the turnover, while the retail segment contributed around 48 percent, the compnay says.
The developer’s retail portfolio turnover advanced by 4.1 percent to HK$1 billion, while office turnover grew by 13.3 percent to HK$929 million.
The estimated overall tenant sales within the retail portfolio also recorded a 4 percent year-on-year growth, outperforming Hong Kong’s retail sales decline of 2.6 percent for the same period.
But the retail sales growth slowed to 3 percent in the second quarter from 5 percent in the first quarter, chief financial officer Roger Hao Shu-yan said.
He added that high-end brands, food and beverage, and lifestyle sales outlets recorded growth while jewelry, watches, and clocks fell in the first half.
Hysan expects to record a more than 10 percent decline in retail sales last month.
Hao said 20-25 percent of merchants' leases will expire next year, which is relatively low.
He said Hysan will discuss rentals with merchants during different stages of the economic cycle to support their business.