Swire Properties” retail portfolio on the Chinese mainland posted double-digit rental growth in the first half of 2026, buoyed by strong demand at its flagship luxury shopping centers as affluent consumers continued to spend on high-end brands.
Retail rental income from the Chinese mainland rose 13 percent from a year earlier to HK$2.57 billion ($327.4 million) in the six months ended June 30, according to interim results released by parent company Swire Pacific. Excluding currency movements, rental income increased 7 percent.
Taikoo Li Sanlitun in Beijing helped deliver the strong performance, with retail sales surging 63 percent and rental income climbing 16 percent after the completion of a tenant repositioning program and the opening of Hermes’ global flagship store in April. Occupancy reached 100 percent at the end of June.
Swire attributed the improvement to a series of luxury flagship openings since late 2025, including standalone concept stores and architecturally distinctive boutiques, alongside the repositioning of the complex’s South Area. The company also cited a rebound in international tourism and the country’s expanded tax-refund policies for overseas visitors as supporting demand.
In Shanghai, its HKRI Taikoo Hui shopping complex reported an 82 percent jump in tenant sales and a 29 percent increase in rental income after Louis Vuitton opened “The Louis” flagship in mid-2025. Occupancy remained at 98 percent.
Chengdu Taikoo Li recorded 14 percent growth in both tenant sales and rental income, while Guangzhou Taikoo Hui posted increases of 9 percent and 11 percent, maintaining full occupancy. Qiantan Taikoo Li in Shanghai reported retail sales and rental income growth of 14 percent and 16 percent, respectively.
Swire said China’s retail market continued to improve during the first half, with retailers remaining “cautiously optimistic” about medium to long-term prospects and continuing to invest in prime commercial locations. The company said that luxury categories including jewelry, watches and precious gems continued to outperform.
Meanwhile, Hang Lung Properties Ltd, another major owner of luxury shopping centers, reported that tenant sales at its malls on the Chinese mainland rose 17 percent in the first half after increasing 24 percent in the first quarter, the strongest quarterly growth in two years.
At Plaza 66 in Shanghai tenant sales climbed 24 percent while rental revenue increased 8 percent, with occupancy holding at 98 percent. The company’s 4,300-square-meter Phase III expansion is scheduled for completion in the second half of the year. Nearby, Grand Gateway 66 also recorded a 24 percent increase in tenant sales, although rental revenue rose a more modest 1 percent.
Outside Shanghai, Wuxi Center 66 achieved full occupancy as rental revenue increased 10 percent, while Dalian Olympia 66 and Kunming Spring City 66 reported double-digit tenant sales growth following tenant mix upgrades.
Unlike Swire, which has continued to strengthen its positioning in the ultra-luxury segment through global flagship stores, Hang Lung has increasingly diversified its tenant portfolio beyond traditional luxury brands in an effort to broaden traffic and spending across consumer groups.
wangzhuoqiong@chinadaily.com.cn