A US$1 billion, three-year renovation of Hongkong Land’s Landmark-branded properties in Hong Kong’s Central district aims to create an “extraordinary experience” for wealthy shoppers and strengthen the presence of global luxury brands in the city.
Hongkong Land will pour more than US$400 million into the “Tomorrow’s Central” project, which the company said is its biggest single investment in the city in a decade. Retail tenants across the Landmark portfolio will spend an estimated US$600 million more to design and create their own spaces in the upgraded complex, the company said.
The project will overhaul the Landmark properties over a three-year period starting in the third quarter, Hongkong Land said.
“This huge investment will of course help to boost our [gross domestic product] and create employment,” Deputy Financial Secretary Micheal Wong Wai-lun said during a press conference. “It also demonstrates, in a most direct and convincing manner, Hongkong Land’s judgment and confidence in the future of our economy. Let me say that the Hong Kong government shares that judgment and that confidence.”
Hong Kong toppled Tokyo as Asia’s costliest city to build, according to the consultancy Turner & Townsend. Still, the Landmark project represents a “significant milestone for Hong Kong’s luxury landscape” and will reinforce the city’s status as a leading global city, said John Witt, group managing director of Jardine Matheson, Hongkong Land’s parent company.
“We believe this substantial investment will reinforce the Central portfolio, Central and Hong Kong as an enhanced global destination for luxury, retail, lifestyle and offices for future generations,” said Michael Smith, CEO of Hongkong Land.
The project has the endorsem*nt of 10 luxury tenants including Cartier, Chanel, Dior and Louis Vuitton, Alvin Kong, executive director of Hongkong Land, said in an interview.
The renovation will double the retail area occupied by these 10 brands to more than 220,000 sq ft and create a total of 10 unique “maison” (French for “home”) spaces of between two and eight storeys for individual retailers: three each in Landmark Atrium, Landmark Alexandra and Landmark Prince’s, and one in Landmark Chater.
These enlarged spaces will enable the retailers to showcase the widest assortment of products and create highly personalised services for their “very important customers” (VICs), including haute couture, private dining, outdoor terraces and double-height salons, the company said.
The designs will be driven by the brands themselves, “telling their own stories”, and for some of them, their Landmark locations will become their biggest stores in the world, Hongkong Land said.
In addition, a 24,000 sq ft exhibition space of international auction house Sotheby’s is set to open in Landmark Chater in July this year.
The Landmark portfolio will offer a total of 260,000 sq ft of food and beverage spaces after the transformation, the company added.
“We need spaces to create these extraordinary experiences,” said Alexander Li, chief retail officer for commercial property in Hong Kong and Macau at Hongkong Land. “There is a trend of consumers moving towards experiences. It will take some time for [shoppers] to come back, but we can create something to give them a reason to come.”
The VICs – loyal customers who spend more than HK$200,000 (US$25,600) per year – account for 80 per cent of sales at Landmark, the company said. Shoppers from outside Hong Kong only account for 20 per cent of sales.
VICs are accustomed to exclusive privileges, according to Li. “Imagine you have a private room in the middle of Central, which you can walk into at any point, and park your car free every day”, he said, adding that the renovated Landmark will bring their experience to the “next level”.
The Landmark will remain open during the project, as the work will be carried out mainly at night. The lowest two levels of offices in the Prince’s Building and Gloucester Tower, as well as the bar and lobby of The Landmark Mandarin Oriental, will be converted, with office tenants relocated.
“As we improve the ecosystem and the retail and lifestyle offers, it also makes Central a more desirable business destination,” Kong said.
“We’ve been developing and taking the Central brand to the Chinese mainland, and the success of the Central ecosystem [in Hong Kong] would be a very important cornerstone to support our growth into the mainland.”
Hongkong Land owns and manages more than 850,000 square metres (9.1 million sq ft) of prime office and luxury retail property in key Asian cities including Hong Kong, Singapore, Beijing and Jakarta.
It has four commercial developments across China, while another 10 projects including a mega project in Shanghai’s West Bund Financial Hub are expected to be launched from 2024 to 2028, according to its recent annual results.
