Shop owners cash in on V City

Tuen Mun shop owners - particularly those near the West Rail MTR station - stand to reap a windfall as the new HK$2.自存倉5 billion V City shopping center is revitalizing the area's retail property market. Developer Sun Hung Kai Properties (0016), which recently opened the 300,000-square-foot mall, expects the 130-plus shops and restaurants to attract more than 100,000 visitors a day - including locals, tourists and mainlanders, as Tuen Mun is less than 30 minutes away from Shenzhen Bay Port. V City's location at 83 Heung Sze Wui Road serves as a transport hub with more than 50 shuttle routes to housing estates and cross-border buses. "Most owners started holding on to their shops in 2011, in the hope that prices would rise further," said Dennis Cheng Tak-ming, a senior sales director at Centaline Property Agency. Currently, there are only about four shops available for sale in the entire neighborhood around V City, and owners are generally asking for HK$10 million above the market average. Meanwhile, shop owners leasing out their premises are doubling or even tripling their rents. For example, the owner of a 856-sq-ft shop at 28-38 Heung Sze Wui Road is now asking HK$85 million for the property he bought for only HK$34 million in January last year. Agents said he recently rejected an offer of HK$65 million. The space is occupied by PrimeCredit, a local financial institution, whose monthly rent of HK$125,000 is 60 percent higher than the HK$78,000 it paid up to a year ago. Another owner subdivided 1,000 sq ft of retail space on nearby Yan Ching Street into five small shops and is asking total rent of HK$600,000 a month - comparable with that in Causeway Bay. "Some rents have even tripled," Cheng said. UA Finance, which leases 800 sq ft of space at 12 Heung Sze Wui Road, saw its monthly rent jump to HK$150,000 this month - up from HK$50,000 under the previous contract signed in 2010. Another shop on the same street was rented out last month for HK$100,000 per month, compared with HK$52,000 paid by the previous salon tenant. Midland IC&I (0459) sales director James Siu said retail rents in the vicinity have risen about 40 percent on average, although there are cases of them more than doubling. "Most shop owners are optimistic about the future development of Tuen Mun, expecting the district to be turned into a new shopping destination for tourists and locals," Siu said. V City has attracted a number of interna迷你倉新蒲崗ional high-end brands, including agnes b and Gap. Jewelry retailers such as Chow Sang Sang and Chow Tai Fook have also established presences there. Prior to moving into the new mall, Chow Tai Fook paid HK$140,000 per month for nearby premises at 6-24 Yan Ching Street. A Vietnamese restaurant recently took the space, for HK$200,000 a month. Cheng said traffic flows in the area have doubled since V City opened this month, with buses and minibuses linking the mall with Shenzhen Bay Port and Lok Ma Chau. CityBus has increased the frequency for its B3 and B3X routes between Shenzhen and Tuen Mun to three times per 15 minutes. "It only takes me 20 minutes to get to Tuen Mun, where I can get everything I want, including baby milk formula and snacks," said a mainlander, surnamed Liu, who comes cross-border shopping with her two-year-old daughter every week. Routinely spending about HK$1,200 per trip at the landmark Tuen Mun Town Plaza, developed by Sino Land (0083), she takes advantage of the free shuttle bus from Shenzhen Bay Port and back. Siu said over the past few months, some shop owners have even started inviting expressions of interest from potential new tenants while an existing lease is still in place. For instance, the owner of a 1,340-sq-ft space at 28-38 Heung Sze Wui Road has made it clear he intends to jack up his asking rent to HK$150,000 per month after the expiry of the current tenant's lease at HK$55,000 a month. Tuen Mun residential property prices have also been boosted by new developments in the district, as well as the rising frequency of mainlander visits. The asking rents of 20 flats available at Century Gateway, atop V City, are at least 50 percent higher than the market average, about HK$15,000 per month. "Around one-third of the homeowners in the first phase of Century Gateway are mainlanders, among which 10 percent are investors,'' said Midland Realty district manager Andy Ng Wai-kwong. He pointed out that a 300-sq-ft secondhand home in Tuen Mun now costs more than HK$2 million - double the price of two years ago. Separately, veteran investor Tang Shing-bor just bought a 14-story industrial building at 4 Kin Fung Circuit - near V City - for HK$498 million. He is speculating on the property, as the Town Planning Board has given approval for its conversion into an office and retail complex. The building currently generates monthly rent of HK$1.3 million. karen.chiu@singtaonewscorp.com 迷你倉出租