By  on March 13, 2007

HONG KONG — Not every store opening requires crowd control measures, but such was the case when Hennes & Mauritz opened here.

Even those with invitations to the opening party found themselves waiting to get in — alongside dozens of paparazzi and a noticeable police presence. For its public opening Saturday, 1,000 shoppers lined up starting at 5 a.m. Store managers gave away a few jackets autographed by Madonna as well as M by Madonna sunglasses to the first 500 customers. The Hong Kong store is the first in the world to receive the new Madonna line.

H&M has had a sourcing office in the city for decades, but this week marks the company's first foray into retail in Greater China. According to Nils Vinge, head of investor relations at H&M, the timing and location are perfect.

"Hong Kong is fashion-oriented and the people are big fashion spenders," he said, noting the company will add a second location in Hong Kong in the fall and will open two Shanghai stores this spring. The first Shanghai store will bow on April 12 on Huahai Lu, in a location once occupied by Benetton.

Vinge said that, to outsiders, it might seem H&M is slightly behind some of its competitors in terms of Asian expansion, but the company has a strategy. "We still have so much to do in our existing markets. We have no rush to plant flags all over the world; we're taking it one step at a time," he said.

Vinge explained H&M prefers to solidify its presence in selected cities rather than through expansion to new markets. "In our business model, in order to get efficiency of sales when it comes to logistics and infrastructure, we need a certain number of stores to reach critical mass. We want more than one or two, but just how many or how fast this happens remains to be seen," he said.

The location of the Hong Kong H&M provides a big talking point for real estate analysts and retailers alike. For decades, the building, known as Lane Crawford House and owned by Wheelock, served as Lane Crawford's flagship. When Lane Crawford moved to its new location at International Finance Centre, Wheelock tried to sell the building. However, no bids reached the asking price of 2.5 billion Hong Kong dollars, or $320 million, leading Wheelock to redevelop the 12,286-square-foot building and rename it Crawford House.

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