HONG KONG — Adidas is planning to take over a large Central storefront recently vacated by Coach, an industry source told WWD, yet another example of a sportswear brand to gain square footage in the city as luxury firms scale back their presence.
Adidas declined to confirm the upcoming store, but when asked about the matter, a spokeswoman for the brand said the company was preparing an announcement toward the end of the month.
Coach exited its lease on the four-story shop two years early at the end of August, swapping it for a more modest space in the nearby IFC mall. It’s one of many luxury brands that has sought to reduce operating costs to balance the decline in Mainland Chinese tourist spending.
While the year has been mostly doom and gloom for the city’s retail sector and feedback from recent Golden Week sales was disappointing, a report from real estate consultancy Cushman & Wakefield pinpointed fast-fashion and sportswear as opportunities.
It cited the many athletic apparel brands that have been busy flexing their muscles of late. Last month, Lululemon opened a second door in Causeway Bay’s Hysan Place mall, Under Armour opened a new storefront in Central over 3,000 square feet in size, bringing its store count in the city to three, and 2XU launched its first counter at department store Sogo. Earlier in May, Fila opened its first flagship in Tsim Sha Tsui.
Adidas already keeps a dedicated women’s store two streets over from the upcoming unit and in January, it launched an Adidas Originals flagship.
Athletic brands taking up new leases are likely to benefit from reducing rents. The Cushman & Wakefield report added that prime retail rents will likely see contractions until year’s end.
“As a result of these short-term headwinds, rents may fall 10 percent to 20 percent for the year varying by sector and submarket,” it noted.