Hermes expands in Hong Kong betting on the return of luxury buyers

French luxury giant Hermes International SCA is expanding its store in one of Hong Kong's most exclusive shopping malls, adding to signs that premium brands are renewing their focus on the city as an economic slowdown weighs on businesses. China's perspectives.

The three-story store in Causeway Bay's Lee Gardens is undergoing renovations and is expected to reopen mid-year with a much larger footprint, according to people familiar with the matter, who asked not to be identified because they are not authorized. to speak. in public. As part of the expansion, Hermes took over a neighboring store on one floor, they said.

The store will have an expanded product offering including handbags and furniture, giving customers better access to stock, one of the people said. Hermes currently has seven stores in Hong Kong, according to its website, including its flagship store in Central.

The company did not immediately respond to a request for comment.

Hermes' move to Hong Kong symbolizes a broader shift underway for some of the world's biggest luxury brands. After pouring investment and resources into mainland China to capitalize on the Covid-related shopping boom, the collapse of the housing market and rising youth unemployment have caused many consumers, especially the aspirational middle class and the moderately wealthy, to adjust the belt.

This has renewed the appeal of Hong Kong, whose large concentration of ultra-wealthy residents are seen as better able to weather uncertainty.

Return of luxury

Hong Kong has already been quietly making a comeback, regaining its title as the world's largest per capita luxury consumer last year, according to data from Euromonitor International. He had lost his no. 1 spot behind Switzerland and the United Arab Emirates after months of social unrest in 2019, then three years of strict Covid restrictions and hit retail sales.

Other major brands are optimistic about Hong Kong. Last year, Chanel rented a two-story store in Causeway Bay for about HK$3 million ($384,000) a month, following a drop in rental prices during the pandemic.

Meanwhile, Louis Vuitton, part of billionaire Bernard Arnault's luxury conglomerate LVMH Moet Hennessy Louis Vuitton SE, opened a pop-up menswear store and cafe in January in the affluent Mid-Levels neighborhood. The brand also hosted its first fashion show in the city in November. Fellow LVMH brand Dior will showcase its pre-fall men's collection in Hong Kong in March.