Time to buy property in Hong Kong for F&B... or Not?

I consistently hear that it’s impossible to buy commercial property in Hong Kong on the part of retailers or food and beverage operators; so they are stuck as renters for ever. They claim prices are too high and the market is dominated by major landlords, and small landlords are unwilling to sell at reasonable prices or even release property onto the sales market.

In my view, in recent years there was not a better time to acquire commercial real estate in Hong Kong than a few months ago; and that may still be the case. The  increase in take up of leases now and a high level of competition for valuable ground floor commercial space in the food & beverage sector is telling. Even the most questionable of sites earlier in the year or mid year, are seeing interest as people are gearing up for what was, predicted by some, to be a positive turnaround by mid 2024.

Some delayed projects are now being picked up again and the increase in take up of premises that are available, readily fitted, and readily licensed, by operators, seeking to do a fast turnaround, is clear. I was recently involved in a transaction to obtain a leased premises, which although looking past its prime, was only need of a refresh and new visionary entrepreneur to run it. That property is not mentioned in this post for obvious reasons.

The numbers on taking over pre-existing premises with fittings, fixtures, and licenses enable exceptionally short start-up periods, reduced redecoration costs and a fraction of what was spent (to build) being involved. These are all going to disappear swiftly over the next few months; most have already done so.

As for buying

One company, I recently met the founder of is bucking that trend on the local market, providing current and significant information to the public on an almost daily basis (if you can understand Cantonese) and it’s always been hard to see what is happening at street level in Hong Kong even if you are a “local”.  Edwin has now started to produce English language content and if you’re remotely interested in the wider Hong Kong real estate market; his content is worth a watch.

https://youtu.be/f0CNxLmtndc?si=23fM3ZPlUinvTOL3

Being dedicated to an incessant stream of news production is hard work and physically taking to the streets, monitoring trends, and isolating opportunities for purchases of real estate all over the city is an interesting approach, as he builds his own business.

Cheap deals are there still

At a time when many operators are still hunkering down, deciding not to spend any more money, and embarking upon ongoing strategies of non-expansion and non-investment, this might be exactly the wrong time for that.

Fortune favors the brave, but it is also sometimes dangerous to be too brave or too adventurous; you may just lose a fortune.

But when you can take over an existing food and beverage outlet, fully equipped, licensed and capable of a swift turn around for maybe 15-20% of what it would cost to build and get a decent long term rental deal … why would you not do so?

If you have a vision, and you can buy the ground floor retail unit at a reasonable price in a peripheral area or small town area of the new territories, for your franchisable concept, which has already been proven in the city, why would you not try to do that?

A lack of long-term vision on the part of food and beverage operators in Hong Kong has probably been their greatest downfall; this may be just the right time to build that F&B group that can weather the years ahead and emerge with not only a good food business but also a decent property portfolio.

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