The family behind Chow Tai Fook Jewellery Group Ltd. wants to look beyond mainland visitors with retail sales in Hong Kong poised to fall an 18th-straight month in May.
“The city is over-reliant on mainland tourists,” said Adrian Cheng, whose family’s Chow Tai Fook Holding controls the world’s largest listed jewelry chain as well as mall-builder New World Development Co Ltd. “What we need is to change our strategy to adjust to changes.”
New World in April revamped an existing mall in Hong Kong for HK$700 million ($90 million) to incorporate amusement-park rides and shops targeted at children.
Chow Tai Fook is also expanding its art-focused K11 mall concept in mainland China, with two properties due to open in the cities of Guangzhou and Wuhan next year, and a further 12 more by 2021, said Cheng, who’s vice chairman at New World.
The group’s K11 mall in Shanghai, which was completed in 2013, has been able to boost visitor traffic about 30 percent whenever it conducts art shows including at its lobby, and that helped the mall to post double-digit growth in sales last year, Cheng said.
Visits by mainland tourists, who account for more than two-thirds of arrivals in Hong Kong, fell 16 percent in 2015 and slumped a further 13 percent in January to April this year.
Hong Kong retail sales data for May, due out Thursday, is forecast to show a fall of 8.8 percent as the slump worsens from the 7.5 percent decline in April.