Core Insights - The recent Golden Week holiday saw over 1.394 million mainland visitors to Hong Kong, indicating a recovery in tourism [1] - Retail sales in Hong Kong, particularly in gold and cosmetics, experienced low double-digit growth, suggesting a gradual stabilization in the local retail market [1] - Despite the increase in visitor numbers, the spending power of tourists remains weak, with shopping being a secondary activity to in-depth travel experiences [1] Retail Performance - The retail management association noted that local consumer spending is better than expected, with fewer residents traveling abroad, which positively impacts overall business [1] - Tourist areas such as Tsim Sha Tsui, Mong Kok, and Causeway Bay showed increased foot traffic, with Tsim Sha Tsui performing the best [1] - Although some retail categories experienced declines, the overall trend is a stable increase, driven by gold and cosmetics sales, which are influenced by rising gold prices [1] Market Dynamics - The chairman of the retail management association agreed with the Financial Secretary's view that the retail market is stabilizing, but highlighted that the total sales value in August was only around 30 billion, indicating limited growth [1] - There are variances in performance across different retail categories, with some experiencing single-digit increases or decreases [1]

Retail Market Outlook - The retail market in Hong Kong is expected to remain stable in the first half of 2025, with improvements in local consumption and tourist traffic anticipated in the second half [1] - Demand for retail leasing will continue to be dominated by food and beverage operators, particularly brands targeting the mass and mid-market segments [1] - The vacancy rate in core areas decreased by 0.7 percentage points to 7.1%, leading to a quarterly rental increase of 0.9%, consistent with the first quarter of 2025, resulting in a total rental growth of 1.9% for the first half of the year [2] Industrial and Logistics Sector - Despite a cautious market sentiment, demand for high-spec metal storage warehouses is expected to rise, with warehouse rents projected to decline by 0-5% in 2025 [1] - The industrial and logistics sector is experiencing a significant drop in leasing demand due to geopolitical tensions and unclear trade policies, leading to an increase in available space and a quarterly rental decline of 0.8%, marking the sixth consecutive quarter of decline [2] - The warehouse vacancy rate rose by 0.4 percentage points to 10.3% by the end of the first half of 2025 [2] Capital Market Insights - Investors are generally adopting a cautious wait-and-see approach amid ongoing economic headwinds, with limited support from the reduction in HIBOR [3] - There are signs of market stabilization, particularly with a noticeable increase in inquiries from self-use buyers as capital values continue to decline and borrowing costs decrease [3] - Following the government's announcement of a pilot program for converting hotels into student dormitories, interest from hotel and office owners in related opportunities is expected to rise [3]